Dow dives more than 2,000 points as worries grow over coronavirus impact

The financial market chaos comes amid increasing worries that the coronavirus epidemic will plunge the global economy into recession.

• By Avie Schneider/NPR

(New York) — Stock indexes tumbled so fast Monday that trading on the New York Stock Exchange was halted temporarily for the first time since October 1997. The Dow Jones Industrial Average lost 2,013 points. The blue chip index fell nearly 7.8% and the S&P 500 dropped 7.6%.

The 15-minute trading halt came shortly after the opening bell, when stocks tumbled in reaction to Saudi Arabia’s shocking oil price cut.

The market-wide trading halt was the first since the market crash of Oct. 27, 1997, when the Dow Jones Industrial Average dove 554 points, or 7.2%.

The financial market chaos comes amid increasing worries that the coronavirus epidemic will plunge the global economy into recession. Stocks also fell sharply in Asia and Europe.

The price of oil also fell — down about 25% Monday following the unexpected Saudi move.

As investors fled stocks and sought relative safety in government bonds, the yield on the benchmark 10-year Treasury note fell below 0.4% overnight before climbing above 0.5% Monday afternoon.

Over the weekend, Saudi Arabia announced a stunning discount in oil prices — of $6 to $8 per barrel — and a boost in production.

The move was a dramatic reversal from a few days earlier. Late last week, talks between OPEC and Russia collapsed after weeks of negotiations. The kingdom had tried but failed to get Russia to agree with OPEC to cut production to keep prices from falling in reaction to economic worries about the coronavirus.

The oil price war comes amid increasing fears that the coronavirus will hit the global economy hard as factories shut down, travel plans are canceled and spending grinds to a halt. In Italy’s industrial region, 16 million people are under quarantine as the country fights to control the coronavirus outbreak there.

Worldwide, there are more than 110,000 COVID-19 cases, including more than 7,000 each in South Korea, Italy and Iran, according to a dashboard created by the Johns Hopkins Whiting School of Engineering.