The turmoil in the stock market about the spreading coronavirus continued for a seventh day on Friday, when mid-day wall street fell more than 2 percent after declines in Asia and Europe.
Drop caused mainly by concerns that measures to curb the spread of the virus will prevent corporate profits and economic growth, as well as fears that the outbreak could worsen.
The closure of factories and quarantine in China has violated global supply chain. Companies such as Microsoft, warn that it will affect their sales, and analysts at wall street have begun to consider these warnings in their expectations of profit growth this year.
Hundreds of companies have begun to take steps to prevent the disease suffered by their employees, including to restrict visits and to ask employees to work from home. All this can reduce performance.
Investors react by selling shares and commodities such as oil, as they foresee the coming recession. The sale itself can help trigger the slowdown as it constrains spending both companies and individual investors.
If the virus is spreading in the United States, the Federal reserve may have to cut rates. The flash is a serious test for President trump, whose presidential barometer indicators is closely linked with the economy and growing stock market.
On Friday the drop in Asia and Europe followed the drop by 4.4 percent in the S & P 500 index on Thursday, the worst day for U.S. stocks since 2011.
