The Dow Jones Industrial Average closed down 2,013 points, or 7.8%, marking the index’s worst day percentage-wise since October 2008. The Dow also shattered its record for largest loss as measured by points, which was set at 1191 points on February 27th this year. The S & P closed with a loss of 7.6%, and the Nasdaq composite ended Monday with a loss of 7.3 percent.
The massive sell-off triggered a key market circuit breaker minutes after the opening bell. Trading was halted for 15 minutes, an automatic pause designed to prevents stocks from suffering rapid cyclical losses, until reopening at 9:49 a.m. ET. The sharp declines followed a roller-coaster week that saw the S&P 500 swing up or down more than 2.5% for four days straight. While Monday’s drop was significant, it still didn’t crack the 20 worst days for the S&P 500.
Futures cratered Sunday and early Monday morning after the Organization of Petroleum Exporting Countries (OPEC) failed to reach a deal to curb oil output, prompting Russia and Saudi Arabia to boost production and sent oil prices plummeting. Along, with the increasing worry of investors that policymakers have not yet done enough to protect the global economy from the downturn caused by the coronavirus rise in confirmed cases, has resulted in this decline.
The Federal Reserve announced an emergency rate cut last week to combat the economic impact from the virus, its first such move since the financial crisis. President Donald Trump on Friday signed a sweeping spending bill of an $8.3 billion package to aid medical research.
Hopefully, with the rate cuts, lower gas prices and a slowdown in the coronavirus, these corrections will help the stock market rebound in the near future.