U.S. stock markets tumbled Wednesday after Federal Reserve Chairman Jerome Powell warned of a possible "prolonged recession" due to the coronavirus even as the central bank is prepared to take further steps to combat the worst downturn since World War II.
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The Dow Jones Industrial Average dropped over 516 points, or 2.17 percent, while the S&P 500 dipped 1.75 percent and the Nasdaq Composite fell 1.55 percent.
|I:DJI||DOW JONES AVERAGES||28195.42||-410.89||-1.44%|
|I:COMP||NASDAQ COMPOSITE INDEX||11478.882835||-192.67||-1.65%|
Powell said the Fed will use the tools at its disposal "to the fullest" until the crisis has passed and recovery is “well underway" for the economy, even as a debate rages over whether states are scaling back lockdowns too quickly.
"Economic forecasts are uncertain in the best of times, and today the virus raises a new set of questions," Powell added. "How quickly and sustainably will it be brought under control? Can new outbreaks be avoided as social-distancing measures lapse?"
As localities around the nation make varying decisions on how quickly to move out of shutdown mode, Arizona has decided to allow pools, gyms and fitness centers to reopen with social-distancing guidelines in place. Meanwhile, Los Angeles County said stay-at-home orders will likely remain in place for the next three months.
Dr. Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases, and other members of the coronavirus task force testified before a Senate committee on Tuesday, warning of the risks of states not following guidelines and reopening too quickly.
Looking at stocks, Uber reportedly offered over $60 per share for GrubHub, according to the Wall Street Journal. Shares of the food-delivery service closed lower at $58.14 per share.
|UBER||UBER TECHNOLOGIES INC.||34.22||+0.50||+1.48%|
Las Vegas Sands ended its plans for a $10 billion casino project in Japan. Rivals Caesars Entertainment and Wynn Resorts previously suspended their pursuits of Japanese casinos.
|LVS||LAS VEGAS SANDS CORP||44.96||-0.41||-0.90%|
|WYNN||WYNN RESORTS LIMITED||69.67||-1.45||-2.04%|
Streaming company Roku announced plans for the sale of up to 4 million common shares over time.
Embattled retailer J.C. Penney is in talks for a $450 million loan ahead of a bankruptcy filing that is expected to come as soon as Friday, CNBC said.
On the earnings front, cybersecurity firm CyberArk Software beat Wall Street estimates for both earnings and revenue but predicted second-quarter sales and operating income below expectations.
West Texas Intermediate crude oil fell 1.90 percent to $25.29 a barrel after weekly data showed U.S. inventories fell for the first time in 16 weeks. Meanwhile, gold advanced 0.56 percent to $1,713.90 an ounce.
U.S. Treasurys ticked higher, pushing the yield on the 10-year note to 0.648 percent.
European markets were lower across the board, with France’s CAC down 2.32 percent, Germany’s DAX sliding 1.92 percent and Britain’s FTSE off 1.13 percent after government data showed the U.K. economy shrank by a record 5.8 percent in March.
In Asia, Japan’s Nikkei fell 0.49 percent and Hong Kong's Hang Seng slipped 0.27 percent while China’s Shanghai Composite added 0.23 percent.