NEW YORK -- Wall Street and markets around the world fell sharply Wednesday as the economic and physical toll caused by the coronavirus outbreak mounts -- and as experts say they still can't predict when it will end.
The S&P 500 lost 4.4% after the White House said 100,000 to 240,000 Americans could die from covid-19, even if the country follows guidelines to avoid shopping trips, eating at restaurants and other activities through April. Florida's governor became the latest to issue a statewide stay-at-home order.
The S&P 500 fell 114.09 points to 2,470.50, and all 11 sectors that make up the index lowered.
The Dow Jones Industrial Average lost 973.65, or 4.4%, to 20,943.51, and the Nasdaq composite fell 339.52, or 4.4%, to 7,360.58.
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Stay-at-home restrictions have already deeply gashed the economy, and Whiting Petroleum, one of the biggest drillers in the Bakken shale formation, filed for Chapter 11 bankruptcy protection Wednesday, with the price of oil near $20 a barrel. Automakers also reported sharp drops in U.S. sales for March, including a 43% plunge for Hyundai. Mortgage applications tumbled 24% from year-ago levels as open houses are all but shut down.
The yield on the 10-year Treasury note dropped to 0.60% from 0.70% late Tuesday. A bond's yield drops when its price rises, and investors buy long-term Treasury notes when they're fearful because they see U.S. government bonds as having virtually no risk of default
"There is a lot of uncertainty," said Megan Horneman, director of portfolio strategy at Verdence Capital Advisors. "The negative news is really taking over."
The negative news was also global. Japanese stocks took some of the world's heaviest losses, down 4.5%, after a survey of business sentiment there fell to its worst result in seven years. Britain's FTSE 100 fell 3.8% after big banks there scrapped dividend payments, part of a worldwide effort by companies and households alike to conserve cash.
Stocks have plunged this year as the coronavirus pandemic forces economies into what is expected to be a steep, sudden recession. The S&P 500 just closed out its worst quarter since 2008 with a 20% loss.
"The challenge for investors is you don't know how deep and how wide this downturn may be," said Rob Haworth, senior investment strategist at U.S. Bank Wealth Management. "It ends up being a true leap of faith that the forecast and the duration of the pandemic will be accurate."
A report on Wednesday said that private U.S. employers cut 27,000 jobs last month, which was actually much milder than economists were expecting. The survey used data from March before the number of people seeking unemployment benefits exploded to a record.
Even Friday's more comprehensive jobs report from the government may not show the full scale of the layoffs sweeping the country, according to Rhea Thomas, senior economist at Wilmington Trust. Small businesses are seeing the sharpest declines in employment, and some firms that closed may not be responding to the survey.
The government's weekly jobless claims report may offer a better view. The next batch of numbers is out today, and economists say it could blow past last week's nearly 3.3 million initial claims, which itself was quintuple the previous record.
Stocks had cut some of their severe losses in recent weeks as Washington swooped in with aid for the economy and markets.
The S&P 500 jumped nearly 18% in just three days last week as Congress struck a deal on a $2.2 trillion rescue package for the economy and the Federal Reserve promised to buy as many Treasury notes as it takes to get lending markets running smoothly.
House Democrats are already collecting ideas for a possible fourth round of aid for the economy, and President Donald Trump has tweeted his support for a $2 trillion infrastructure package. But top Republicans in Congress say they first want to see how well their just-approved programs do.
Among the few gainers in the stock market Wednesday were Kellogg, Dollar General and other companies selling day-to-day essentials that households are stocking up on to ride out stay-at-home orders.
On the losing end was Macy's, whose drop Wednesday brought its loss for 2020 so far to nearly 74%. So much of the company's market value has vanished that S&P Dow Jones Indices is removing it from the S&P 500 index of big U.S. companies, skipping its index of mid-sized stocks and placing it into its small-stock index, effective Monday.
The market's hardest-hit areas included banks, utilities and other dividend payers.
"There are more worries now about this rippling through dividend payments and cutting back on the income investors are getting," said Jeffrey Kleintop, chief global investment strategist at Charles Schwab.
Banks suffered on speculation the largest will be forced to cut dividends after European lenders including HSBC Holdings Plc and Standard Chartered Plc halted payouts and share buybacks. The region's Stoxx 600 index sank, even after the European Union unveiled plans to save jobs during the crisis. The euro extended its drop as manufacturing data from the single-currency region painted a bleak picture, with Italy's purchasing managers' index posting a record drop.
Investors disappointed with the loss of dividend income could spark a fresh wave of selling, knowing that analysts are dashing to update earnings forecasts to take into account the looming global recession and the slump in stock prices.
Information for this article was contributed by Stan Choe, Damian J. Troise, Alex Veiga and Yuri Kageyama of The Associated Press and by Jeremy Herron and Vildana Hajric and Bloomberg News.
Business on 04/02/2020