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Stocks plunge amid fears coronavirus pandemic will worsen

U.S. equity markets tumbled Wednesday, extending the pain from their worst first quarter in years, after President Trump warned the number of COVID-19 infections is set to surge.

The Dow Jones Industrial Average plunged 877 points, or 4 percent, in the opening minutes of trading while the S&P 500 and Nasdaq Composite fell 3.7 percent and 3.08 percent, respectively.

The blue-chip Dow plummeted 23 percent during the first three months of the year, its worst quarter since 1987. The S&P 500 fell 20 percent and the Nasdaq Composite shed 14 percent, their worst quarterly performances since the fourth quarters of 2008 and 2018, respectively.

Trump delivered a sobering COVID-19 assessment on Tuesday evening, warning the country is in for a “very painful two weeks” and that the number of deaths in America due to the virus could surge as high as 240,000.

So far, COVID-19 has infected 189,633 Americans and killed 4,081, according to the latest data provided by Johns Hopkins University & Medicine. More than 7,000 Americans have recovered.

Looking at stocks, airlines were in focus after data showed passenger traffic was down 88 percent in two weeks.

Xerox ended its $35 billion attempted hostile takeover of HP, saying the COVID-19 pandemic has created conditions that hinder continuing its pursuit of the company.

Macy’s was removed from the S&P 500 as its market capitalization fell to $1.5 billion, the smallest in the index. The stock will be placed in the S&P SmallCap 600 starting on April 6.

Banks stocks were pressured as U.S. Treasurys rallied sharply and the yield curve flattened. The yield on the 10-year note was down 9.1 basis points at 0.608 percent.

Commodities were mixed, with West Texas Intermediate crude oil for May delivery down 1.12 percent at $20.25 a barrel and gold for June delivery up 0.51 percent near $1,588 an ounce.

In Europe, markets were lower across the board, with France’s CAC down 4.17 percent, pacing the decline. Germany’s DAX and Britain’s FTSE were off 4 percent and 3.75 percent, respectively.

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Asian markets fell as Hong Kong’s Hang Seng lost 2.19 percent and China’s Shanghai Composite slid 0.57 percent. Japan’s Nikkei remained closed for a holiday.

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