(Reuters) – Wall Street was set to sink again on Wednesday, as growing signs of coronavirus damage to corporate America overshadowed a burst of optimism about sweeping official moves to protect the economy.
Boeing Co (BA.N) fell another 20% in premarket trading as the planemaker called for a $60 billion bailout for aerospace manufacturers facing the pain of an extended collapse in global travel.
S&P 500 futures EScv1 were down 92 points, or 3.69%, hitting their daily down limit, while the SPDR S&P 500 ETF (SPY.P) plunged 6.3%, signaling that the benchmark index could see a 7% fall at opening – triggering another 15-minute halt.
“We’re just in panic mode here,” said Peter Cardillo, chief market economist at Spartan Capital Securities in New York.
“The fear of, maybe, deflation setting in, is probably one of the reasons why the market is acting the way it is.”
Wall Street’s main indexes had bounced on Tuesday from a massive selloff a day earlier, as the Trump administration pressed for a $1 trillion stimulus package and the Federal Reserve relaunched a plan to purchase short-term corporate debt.
However, investors fear that even dramatic stimulus will not be able to avert a deep recession, as the COVID-19 disease continues to spread rapidly across the globe and estimates for the duration of the damage extend out into the summer.
In the latest signs of corporate stress, FedEx Corp (FDX.N) slumped 4.2% after suspending its 2020 profit outlook and announcing cost cuts.
Even Cheerios maker General Mills Inc (GIS.N), which raised its profit forecast citing bulk-buying of its products, fell 3.7%, while Apple Inc AAPl.O dropped 5.1% as analysts anticipated a significant blow to its business from temporary store closures.
Boeing, just a year ago seen as a perpetual growth stock and a symbol of U.S. tech and industrial power, has now lost more than 60% of its value this quarter while the market overall has fallen by around a third – or around $7 trillion in value.
The collapse into a bear market, among the fastest in history, has spurred some calls for a pause in trading. Treasury Secretary Steven Mnuchin reiterated the administration will keep markets open, while suggesting trading hours could be shortened at some point.
The idea of shortened hours drew immediate opposition from a number of leading investors and exchange managers, who said it would harm the market’s credibility.
Dow e-minis 1YMcv1 were down 821 points, or 3.92% and Nasdaq 100 e-minis NQcv1 were down 328 points, or 4.43%.