The COVID-19 virus is affecting the US economy. US stocks fell sharply Monday, following a sell-off in overseas markets, as a surge in virus cases and a worrisome spread of the disease outside China sent investors running for safety.
The Dow Jones Industrial Average sank more than 1,000 points as the spread of the new coronavirus threatened wider damage to the global economy. The drop was the worst for the index in two years and wiped out its gains so far in 2020.
Nervous investors scrambled for safety, loading up on gold, US government bonds, and other safe-harbor assets. The price of oil fell sharply on expectations that demand for energy would tumble. The Dow lost 1,031 points, or 3.6%, to 27,960. The S&P 500 fell 111, or 3.4%, to 3,225. The Nasdaq fell 355, or 3.7%, to 9,221.
As CBN News reported, the coronavirus has infected more than 79,000 people around the world.
China still has most of the cases and deaths, but the quick spread to other countries increased anxiety about the outbreak's threat to the global economy.
Still, Tedros Adhanom Ghebreyesus, the director-general of the World Health Organization (WHO) stopped short of saying the virus has reached a pandemic scale.
At a news conference, he said the WHO was "encouraged by the continued decline in cases in China."
"Our decision about whether to use the word pandemic to describe an epidemic is based on an ongoing assessment of the geographical spread of the virus, the severity of disease it causes and the impact it has on the whole society," Ghebreyesus said. "For the moment, we are not witnessing the uncontained global spread of this virus and we are not witnessing large scale, severe disease or deaths. Does this virus have pandemic potential, absolutely it has. Are we there yet? From our assessment, not yet."
Even though it hasn't been officially labeled a pandemic, the director of global macro research at Oxford Economics says the coronavirus could result in the world economy experiencing its first quarterly fall in seasonally adjusted output since the global financial crisis of more than ten years ago.
And a group chief economist at Unicredit says it's now "a virtual given" that global domestic output will suffer "a major hit" in the first quarter of this year.