U.S. stocks plunge on dire economic forecasts and pandemic resurgence
Wall Street tumbled in a broad sell-off on Thursday, with the Dow plunging well over 5%, as a cautionary economic forecast from the U.S. Federal Reserve and the prospect of a possible resurgence of COVID-19 infections put investors in risk-off mode.
The S&P 500 and the Dow were on course for their worst day since March 18, when markets were shocked by the abrupt economic lockdowns put in place to curb the coronavirus pandemic. The Nasdaq was set to snap a three-day streak of record closing highs.
Everything’s for sale,” said Tim Ghriskey, chief investment strategist at Inverness Counsel in New York. “There’s fear we’re near a top.”
“The chatter today is back on the virus and the potential for a second wave of the virus,” he said.
Deaths of Americans from COVID-19 could reach 200,000 in September, a grim result of the United States’ economic re-opening before getting growth of new cases down to a controllable level, according to a leading health expert.
At the conclusion of its two-day monetary policy meeting on Wednesday, the U.S. Federal Reserve released its first pandemic-era economic outlook, after which Chair Jerome Powell warned of a “long road” to recovery.