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As a subscriber you can listen to articles at work, in the car, or while you work out. Subscribe NowThe Dow Jones industrial average took a 2,997-point nosedive on Monday as fears deepened that the coronavirus outbreak will throw the global economy into recession.
Even for a market beset by volatility in recent weeks, the losses were staggering. The 12.9% drop in the Dow was its worst since 1987. The S&P 500 and the NASDAQ also dropped 12%.
The losses accelerated in the last hour of trading as President Donald Trump advised Americans to avoid large gatherings. He also said he sees a chance of recession and promised help to the struggling airline industry. The losses came as huge swaths of the economy come closer to a standstill due to the outbreak as businesses and travel shut down.
The Federal Reserve announced a new round of emergency actions late Sunday to prop up the economy and get financial markets running smoothly again, but the moves may have raised fears even further. Investors are also waiting for the White House and Congress to offer more aid to an economy that’s increasingly shutting down by the hour.
The selling began immediately on Wall Street, sharp enough to trigger a temporary trading halt for the third time in the last two weeks.
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The big issue is not financial markets. It’s going to be people losing jobs, health insurance, and homes.