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Major stock market indexes are crashing due to the effects of the raging coronavirus as it continues to spread across China and other countries.
The stock market is already reacting to the spread of the deadly coronavirus. So far, futures on the Dow Jones, Nasdaq as well as the S&P 500 have all plunged as the coronavirus continues to spread even outside of China. The general atmosphere in the stock market is a little bothersome for many investors. Authorities in China and other countries have yet to find a solution to the problem.
Coronavirus Hits the Stock Market
The Dow Jones futures plunged by about 1.6% while futures on the Nasdaq 100 lost 2%. S&P 500 futures also lost 1.6%, as apprehension continues to rise. Similar drops were also seen on Japan’s Nikkei which lost 2% with crude oil futures plummeting as well. Unsurprisingly, the price of gold rose. At the moment, there isn’t a lot of information from markets in Hong Kong, China, Australia, and South Korea. These markets were closed for holiday celebrations.
Expect Further Stock Market and Economic Losses
As CoinSpeaker reported on Friday, the global financial market already began to fall before now, because of the coronavirus. National Securities chief market strategist Art Hogan is now suggesting that there might be further losses. Speaking to CNBC, Hogan said:
“Stocks are relatively priced for perfection, and you tend to have a bit of an overreaction to bad news or in-line news when that happens…We’re going to see the losers lose a whole lot more than we’ve seen in a while. The index itself could probably pull back 3% to 5%.”
Also, many companies in the hospitality and tourism business are feeling the brunt. Casinos in Macau are responsible for a lot of the income some hotels receive. Wynn Resorts and Las Vegas Sands, both of which fall in this category, have lost at least 8% so far.
The travel industry is also experiencing similar problems. United Airlines has also fallen by almost 9%. The airline is worried a drop in customer bookings is imminent.
Other sectors like the manufacturing industry with several phone and car assembly factories in Wuhan, will also be heavily hit by the recent developments.
Coronavirus Death Toll Continues to Rise
Reuters reports that the coronavirus death toll has now risen to 81. As more cases continue to develop, the Chinese government has extended the Lunar New Year holidays for three days, to control the spread. Furthermore, a lot of businesses have either shut down or have instructed their staff to work remotely.
Of the 81 deaths, 76 happened in the Hubei province, whose capital is Wuhan. Furthermore, there are now 2,744 confirmed cases of the infection . Hubei accounts for at least half of them. Consequently, a few regions including Hong Kong, Macao, and Haikou have placed varying restrictions on travelers from Hubei.
Chinese Premier Li Keqiang has visited Wuhan to assess the situation. CNBC reports that Wuhan mayor Zhou Xianwang believes that there are at least additional suspected cases.
The World Health Organization (WHO) has not declared the coronavirus as a global health emergency. Regardless, the CNBC report says that the WHO director-general Dr. Tedros Adhanom Ghebreyesus will visit Beijing to meet with authorities.