U.S. stocks went south on Wednesday, after the World Health Organization (WHO) declared coronavirus a pandemic. Investor fears were further stoked when President Donald Trump imposed a temporary suspension on foreign nationals from Europe travelling to the United States for 30 days beginning Mar 13, in a bid to contain the spread of the new pandemic.
In addition, a steep fall in shares of The Boeing Company (BA - Free Report) pulled down the Dow Jones further.
The three major indexes — the Dow Jones Industrial Average, S&P 500 and Nasdaq Composite — closed in the red on Wednesday. The Dow Jones Industrial Average closed at 23,553.22 after declining 5.9%, the broader S&P 500 reached 2,741.38 after decreasing 4.9% and the tech-laden Nasdaq Composite hit 7,952.05 after losing 4.7%.
The fear-gauge CBOE Volatility Index (VIX) rose 16.1% to close at 62.56 on Mar 11. Finally, decliners outnumbered advancers by a 13.61-to-1 ratio on the NYSE.
WHO Declares Coronavirus a Pandemic
The WHO on Wednesday declared the novel coronavirus outbreak a pandemic. A pandemic is known as the spread of a new disease globally. WHO Director-General Tedros Adhanom Ghebreyesus said that calling the situation a pandemic doesn’t alter “WHO's assessment of the threat” posed by the disease.
In January, the WHO had declared the virus outbreak a public health emergency of international concern. As of Mar 11, there were 118,000 cases and more than 4,000 deaths, the agency said. In addition, the virus has now affected every continent except for Antarctica.
Trump Imposes Europe-U.S. Travel Restrictions
On Mar 11, the President announced that he was taking measures to stop the novel coronavirus from spreading by imposing restrictions on travel from Europe to the United States.The restriction will be in effect from midnight on Mar 13 for the next 30 days. Speaking from the Oval Office, Trump said that the restrictions do not apply to Britain.
The ban, in particular, is on foreigners who have been to the 26 countries from the Shenzhen area in the past two weeks and plan to arrive in the United States. The restrictions exempt U.S. citizens.
In addition, the State Department issued an advisory on Wednesday night, which suggested Americans to reconsider travelling abroad because of the novel coronavirus.
Boeing Plans to Drawdown $13.8 Billion Loan
Aviation giant Boeing was the worst performing stocks on the Dow Jones on Mar 11 after the stock underwent a drop of 18.2% following a Bloomberg report that said the company planned to draw the full amount of a $13.8 billion loan offered by a string of banks.
According to the report, the aviation giant received the loan in February to deal with its cash burn while it readies its 737 Max planes to hit the skies again. The U.S. plane maker had used about $7.5 billion of the loan last month, but is now expected to use the rest. Boeing currently sports a Zacks Rank #5 (Strong Sell). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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AT&T Shares Up on Minimal Coronavirus Impact Expectations
AT&T Inc. (T - Free Report) recently debriefed investors about the progress of the company on various metrics, while offering an update on the probable impact of the deadly coronavirus outbreak on its performance. (Read more)
Accenture to Benefit From ESR Labs Buyout: Here's How
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Occidental to Cut Dividend by 86% on Falling Oil Prices
In the wake of falling oil prices, Occidental Petroleum Corporation (OXY - Free Report) announced that the board of directors has decided to slash quarterly dividend by 86% to 11 cents from the present level of 79 cents. (Read more)
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