Stocks rally, heading off fourth week of decline
Stocks slide after US airlines cancel service to China over coronavirus
U.S. stocks took steep losses Friday morning after major domestic airlines canceled flights to China as the country struggles to contain the outbreak of the lethal coronavirus.
The Dow Jones Industrial Average lost up to 450 points Friday, falling roughly 1.6 percent, after Delta Air Lines and American Airlines announced they would suspend all flights between the U.S. and China starting in February. The S&P 500 index sunk 1.3 percent, while the Nasdaq composite fell 1.2 percent.
The decisions from Delta and American come amid increasing concern about the rapid spread of the Wuhan-based virus. The lethal respiratory illness surfaced in late December and has infected nearly 8,000 people, almost entirely in China, killing 137.
The World Health Organization (WHO) declared the coronavirus a global public health emergency Thursday following the confirmation of 98 cases in 18 countries outside of China. There are also confirmed cases of human-to-human transmission in four countries: Germany, Japan, Vietnam and the United States, according to the WHO.
U.S. companies and businesses have canceled service, travel and operations in China to help prevent the spread of the virus within America. The State Department on Thursday warned Americans not to travel to China for any purpose after previously advising against nonessential travel.
Delta will suspend all service to China between Feb. 6 and April 30, but will follow through with previously scheduled flights to help Americans already in China return home, while American has cancelled service to China between Feb. 9 and March 27. American is facing a lawsuit from the union representing its pilots for making them fly to China despite "serious, and in many ways still unknown, health threats posed by the coronavirus."
United Airlines announced Tuesday the cancellation of 332 flights to and from China between Feb. 9 and March 28, according to Business Insider.
The scramble to halt the coronavirus is likely to dampen economic growth in China, and the damage could extend to the U.S. economy if a prolonged outbreak hinders American firms dependent on steady international travel and Chinese consumer spending.