Trading was halted on Wall Street on Wednesday afternoon, after the S&P 500 fell by 7 percent, triggering a market-wide circuit breaker, the fourth in two weeks.
All three major indices have suffered a grim week, with stocks spiraling downward despite a series of sweeping measures intended to address the growing economic damage from the coronavirus pandemic.
The Dow Jones Industrial Average was down by 1,600 points after trading was paused, settling at 19,576. The blue-chip index has now lost all of its gains since President Donald Trump took office on January 20, 2017.
The losses come after the White House announced on Tuesday that it is seeking a $1 trillion fiscal stimulus package that would help small businesses and certain industry sectors, and put cash directly in the hands of Americans.
The Federal Reserve also stepped in again on Tuesday, introducing a new measure that would keep credit flowing to businesses and households.
While that sweeping action temporarily boosted market morale, it was not enough to stop a sell-off. Restaurants and bars are shuttering their doors, small businesses are flailing, and even major corporations such as Marriott are furloughing thousands of employees.
A huge drop in oil prices has also fueled extreme market volatility, with crude oil now at a 17-year low. The widening economic slump and travel restrictions have weighed on demand, exacerbating the situation after a price war between two key producing countries, Saudi Arabia and Russia, pushed prices down to historic lows.
“When you decimate the restaurant industry, the travel industry, the hotel industry, the airline industry .. the cruise line industry, obviously you’re going to take a huge divot out of economic activity,” DoubleLine Capital CEO Jeffrey Gundlach told CNBC, adding that it was "ludicrous" to think the U.S. would not enter a recession.
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The rollercoaster ride on Wall Street is now driving investors out of the market, leading to reduced trading volume.
As for the market itself, Treasury Secretary Steven Mnuchin said Tuesday at a news briefing, "We believe in keeping the markets open. Americans should have access to their money…everyone wants to keep it open, we may get to the point where we shorten the hours if that’s something we need to do."
The New York Stock Exchange closed for a week, after 9/11, its longest shutdown since 1933. NYSE President Stacey Cunningham said earlier this week that the exchange has several measures to continue operation during a crisis, including electronic trading.
"Investor anxiety is being reflected by the market. But we will get through this," Cunningham told CNBC. "We wouldn't be reducing anxiety by taking a pause in the market. We have the ability to react remotely."