Wall Street collapses after WHO declares coronavirus a pandemic

Dow Jones, S&P500 and Nasdaq dropped in 5-6% on Wednesday

Stock markets experience further sales, after the World Health Organization (WHO) declared the coronavirus outbreak a pandemic.

Dow Jones Industrial Average, the oldest New York stock exchange index plunged into a bear market after 10 years. The index lost almost 5% on Wednesday and it dropped 1,500 points to 23,500. A bear market is a condition in which blue-chip shares fall 20% or more from recent highs during a week.

Markets were probably hoping for the U.S. administration to unveil a fiscal stimulus package to help the economy stand coronavirus epidemic. Yet, Steven Mnuchin, United States Secretary of the Treasury, stated that proposed stimulus package would require Congressional approval. Therefore, he mentioned some smaller measures, which will help small and mid-size enterprises.

On Wednesday, Trump met major bank representatives on press conference. “This is not a financial crisis,” said Michael Corbat, CEO of Citigroup. “The market is only trying to find the right direction,” he added. While Fed reduced its interest rates last week, Trump stated that the government will search for options on how to release the economy.

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