Crashing US stocks on Thursday confirmed Wall Street is in a bear market after new travel restrictions to curb the coronavirus spread spooked investors and rattled world markets.
Donald Trump’s Europe travel ban announced late Wednesday sent all three major US stock indexes into a tailspin, slamming the book on the longest-running US bull market on record.
The benchmark S&P 500 and the Nasdaq have lost about 24% of their value since reaching record closing highs just 16 sessions ago, as nations around the world grapple with how to contain the fast-moving coronavirus and its economic effects.
A bear market is confirmed when an index sinks 20% or more below its most recent closing high.
“It’s the fastest 20% decline ever,” said Paul Nolte, portfolio manager at Kingsview Asset Management in Chicago. “Every day there’s more selling and just when you think you’re at capitulation, you’re not there yet. People don’t know how long this is going to go on so they’re going to sell and walk away.”
Trump’s sweeping travel restrictions, limiting flights from continental Europe to the United States, sent European shares to a near four-year low and slammed airline stocks, already battered by the spread of COVID-19.
Source: Reuters
