US Stocks tumble on virus fears

The US equity market finished session steep lower on Friday, 31 January 2020, as risk aversion selloff triggered on fears that Chinese coronavirus epidemic would impact economic growth in the U.S. and abroad. Meanwhile, selloff fueled further on sluggish U.S. economic data and a mixed batch of corporate earnings. At closing bell, the Dow Jones Industrial Average shed 603.41 points, or 2.09%, to 28,256.03. The S&P 500 lost 58.14 points, or 1.77%, to 3,225.52. The Nasdaq Composite Index retreated 148 points, or 1.59%, to 9,150.94.

The latest figures from China's National Health Commission say that at least 213 people have died and about 9,700 have been sickened. The number of people sickened by the new coronavirus in China now exceeds the global total infected with severe acute respiratory syndrome, or SARS, which killed nearly 800 people after emerging from southern China in late 2002 and spreading into 2003.

 

The U.K. and Russia have also confirmed their first cases of coronavirus infection, raising concerns about the rapid spread of the disease and the impact on the global economy.

Adding to the worries, Delta (DAL) and American Airlines (AAL) recently announced plans to suspend all flights to China as a result of the outbreak.

Adding to the growth concerns was U.S. data showing consumer spending rose steadily in December, but wage gains indicated moderate growth in consumption and business investment contracted, putting the economy on a slower pace this year. Additionally, a report on manufacturing in the Midwest hit a four-year low for January.

Economic news front, report from the Commerce Department showed personal income rose by 0.2% in December after climbing by a downwardly revised 0.4% in November.

The Commerce Department also said personal sending climbed by 0.3% in December following a 0.4% increase in November. Excluding price changes, personal spending inched up by 0.1% in December after rising by 0.3% in November.

Revised data released by the University of Michigan showed U.S. consumer sentiment unexpectedly improved in the month of January compared to the previously reported deterioration. The consumer sentiment index for January was upwardly revised to 99.8 from the preliminary reading of 99.1. The index is now up from the final December reading of 99.3.

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