US stocks hit circuit breakers as shares plunge on coronavirus travel ban

Опубликовано: 12 Март 2020
на канале: Boyd Digital: Business News

Reported today on City AM

For the full article visit: https://www.cityam.com/us-stocks-plun...

US stocks were temporarily halted this afternoon after a ban on all travel from Europe due to coronavirus sent shares plunging.The S&P, Dow Jones and Nasdaq all fell just over seven per cent within minutes of markets opening on Wall Street.Read more: Coronavirus: US travel ban decimates airline stocksThe sharp drop in US stocks triggered circuit breakers, which halt trading on the markets for 15 minutes. It is the second time this week the automatic system has been activated to curb panic selling.US President Donald Trump last night announced a month-long ban on travellers from 26 European countries. The policy, which does not include the UK and Ireland, is aimed at slowing the spread of the virus.Circuit breakers on US stocks are linked to the performance of the S&P 500. If the benchmark index were to fall 13 per cent once trading resumes, another 15-minute pause would be triggered. A 20 per cent plunge would stop trading for the rest of the day.The frantic open compounds yesterday's losses, when the S&P 500 and Nasdaq fell 4.9 per cent and 4.7 per cent respectively. The Dow Jones dropped 5.9 per cent.US stocks need spending spreeInvestors have also been rattled by an apparent lack of economic stimulus from the Trump administration.Many analysts are predicting a further interest rate cut by the US Federal Reserve following its emergency 50 basis point slash last week.However, some have pointed to the need for wider spending policies. Trump earlier this week said he would discuss a "very substantial" payroll tax cut to boost the economy, but a measure is yet to materialise.Read more: FTSE 100 hits lowest since 2012 on Trump coronavirus travel banIn the UK chancellor Rishi Sunak yesterday unveiled the country's biggest spending spree in almost three decades. This include