NEW YORK (Pakistan Point News / Sputnik - 12th June, 2020) US stocks fell their most in nearly three months, with the key Dow Jones Industrial Average losing almost 7 percent, amid fears of a second wave of coronavirus infections and a prolonged period of up to two years for the world's largest economy to recover from the pandemic.
The Dow, the broadest equities gauge on the New York Stock Exchange, closed down 1,855 points at 25,135 points on Thursday.� It was the biggest one-day on the index since the Dow's near-13 percent plunge on March 16.
The S&P 500, a barometer for the top 500 US stocks, ended down 5.8 percent at 3,003. The tech-heavy Nasdaq Composite lost 5.3 percent to finish at 9,492.
Stocks crashed as total US Covid-19 cases topped 2 million, with a jump in cases reported in New Mexico, Oregon, Florida, Texas, and Arizona after five weeks of declines across the country. The potential for a second wave of infections from the virus prompted fears there could be another partial shutdown at least of the US economy, which was mostly closed in March and April.
Also weighing on sentiment were remarks a day earlier from Federal Reserve Chairman Jay Powell that he anticipated a "long road" to economic recovery from the pandemic. The Fed left US interest rates unchanged at near zero in its monthly review on Wednesday, and Powell said he did not expect them to rise through 2022, adding to the pessimism over recovery.
"Stock market gains are slowly getting wiped out as the second coronavirus wave hits the US," said Ed Moya, analyst at New York's online trading platform, OANDA. "The cyclical reopening rotation is over and small-cap stocks could see further downside in the short-term."
With Thursday's slump, the Dow is now 12 percent lower on the year while the S&P500 is off 7 percent. Only the Nasdaq is in positive territory for 2020, with a near 6 percent gain.
