China News Agency, New York, March 9th. The U.S. stock market plummeted on the 9th. The three major stock indexes fell sharply by more than 7% at the opening of the market, triggering a blowout. This is the first time that US stocks have triggered a fusing mechanism since 1997.
On the same day, the Dow closed at 23851.02 points, a drop of 7.79%; the S & P 500 closed at 2746.56 points, down 7.6%; the Nasdaq Composite Index closed at 7905.68 points, down 7.29%. The Dow Jones Industrial Average fell more than 2,000 points throughout the day, setting a single-day drop since 1915.
The fusing mechanism is also known as the automatic suspension mechanism. When the volatility of the stock index reaches the specified fusing point, the exchange suspends trading to control risks. After the "Black Monday" in 1987, the United States set up a fusing mechanism, which was divided into three levels: 7%, 13%, and 20%. On the 9th, after the opening of the three major stock indexes in the US stock market, the first trip was triggered, and trading was suspended for 15 minutes. After that, the stock index fluctuated and continued to decline after midday. Although it fluctuated slightly before the close, it ultimately failed to recover the loss.
The New York Times said that this was the "worst day" for the US stock market since December 2008. Compared with the recent peak of the three major stock indexes, the index has fallen by nearly 20%, which means that the 11-year bull market in US stocks may be facing an end.
The analysis pointed out that international oil prices have plummeted, coupled with the spread of the new crown pneumonia epidemic in the world in recent days, investor confidence has suffered a double blow. On March 6, Saudi Arabia and Russia broke negotiations on a crude oil production reduction agreement, and Russia refused to further reduce production, resulting in a sharp decline in international oil prices.
The Wall Street Journal said that at a time when the world economy is already threatened by the epidemic, the price war between the major oil-producing nations is completely "pour oil on fire." Analysts believe that investors are already very worried that the epidemic will seriously affect global supply chains and consumer demand. If parties to the oil price war cannot resume negotiations as soon as possible, they will also greatly increase market expectations of economic recession.
CNBC said that investors expect the Federal Reserve to continue to cut interest rates sharply, and the regular monetary policy meeting in mid-March may cut interest rates by 75 basis points. Last week the Federal Reserve cut interest rates sharply by 50 basis points. However, some analysts believe that monetary policy can play a very limited role in the current situation, and the market needs the support of fiscal policy.
The stock market plummeted, and money poured into safe-haven assets on a large scale. The international gold price rose to $ 1,678.67 per ounce, an increase of 0.47%. The yield on US 10-year Treasury bonds fell to 0.41% at one time. A lower yield indicates that the transaction price of Treasury bonds has increased, which means that funds are buying Treasury bonds. (Finish)