Stock Market Closes Off Lows For Day, But Fall Caps Worst Week Since 2008 On Coronavirus Panic

Jill Goldsmith

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UPDATED with market close, additional details: U.S. stocks continued an historic rout Friday with the Down Jones Industrial Average closing down 356 points, or 1.38%, on a day where it gyrated wildly amidst growing global panic over the economic impact of the spreading coronavirus. The impact on the entertainment business is massive, with production canceled, theaters shuttered and all but essential travel discouraged.

The World Health Organization on Friday raised its assessment of the global coronavirus risk from “high” to “very high.”

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“We are on the highest level of alert or highest level of risk assessment in terms of spread and in terms of impact,” said Dr. Mike Ryan, executive director of WHO’s health emergencies program. “This is a reality check for every government on the planet: Wake up. Get ready. This virus may be on its way and you need to be ready. You have a duty to your citizens, you have a duty to the world to be ready.”

With global supply chains and consumer spending at risk, travel compromised and public venues from movie theaters to soccer stadiums to theme parks and schools closed in cities across the globe, beyond the human toll, corporate profits have little visibility. Goldman Sachs on Thursday anticipated zero growth in U.S. company profits for 2020.

Media stocks like most others were in generally all in the red, with a few exceptions. AMC Entertainment, which said Thursday that it has closed theaters in the Milan area, surged 9.54% after management announced strong quarterly numbers and steps to boost the stock — including a share buyback and new executive compensation plan.

AMC Networks was up 2.79%, shrugging off the bloodbath. So was Imax, up 1.5%. ViacomCBS was up 1%. Imax, which has theaters in China that have been shuttered for weeks, has been pummeled in recent weeks. As markets continue to fall, some investors do begin to hunt for stocks that have been oversold.

Among the big caps, Disney ended down 0.3%, Comcast fell 1.5%, WarnerMedia parent AT&T lost 1.4%, and Netflix dipped 0.72% – all were off their lows for the day.

The rate of new infection is falling in China but growing everywhere else. Mexico and Nigeria confirmed their first cases of the virus and the death toll is mounting in Italy and Iran. It is spreading into Western Europe and is now present in more than 50 countries. California is monitoring at least 8,400 people. Japan declared a state of emergency on the northern island of Hokkaido – where the Olympic marathons are due to be held this summer.

In four days, the markets surrendered about one third of the gains made since the 2016 election of President Donald Trump.

Asian and European stocks set the stage overnight for another dramatic downturn Stateside on Friday, leading Wall Street into its worst week since the 2008 financial crisis.

The extent of the plunge that started Monday in earnest has shocked investors, companies across sectors and analysts and has been one of the fastest corrections ever from a high. The S&P 500 in fact has never fallen this far this fast from a record.

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