Stocks ended a panicked week with steep losses Friday after the Trump administration declared the Wuhan coronavirus a public health emergency and major U.S. airlines suspended flights to China.
The Dow Jones Industrial Average lost 603 points Friday, a 2.1 percent drop, marking its worst day since recession fears shook financial markets in August. The S&P 500 fell 1.8 percent, while the Nasdaq composite sunk 1.6 percent.
Rising anxiety over the rapid spread of the coronavirus, a lethal respiratory illness, has derailed a stock market rally with fears of steep economic costs in China. There are more than 8,000 confirmed cases of the illness in China, claiming 137 lives, and nearly 100 cases in other countries including the U.S.
Quarantines, travel bans and store closures are expected to take a significant toll on the Chinese economy, and nations with close economic ties to China are likely to suffer as well.
“There will clearly be implications, at least in the near term, for Chinese output, and I guess for some of their closest neighbors, and we'll just have to see what the effect is globally," Federal Reserve Chairman Jerome Powell said Wednesday.
Stocks began sinking Friday morning after Delta Air Lines and American Airlines announced the total suspension of service to China through April and March, respectively. The U.S. State Department had cautioned Americans on Thursday not to travel to China for any reason after previously warning only against nonessential travel.
The pace of Friday’s stock slide picked up shortly before top Trump administration health officials held a conference to formally declare a public emergency. The U.S. is also banning any foreign nationals who’ve traveled to China within the past 14 days from entering the country.
"The risk of infection for Americans remains low. With these and previous actions we are working to keep the risk low," said Health and Human Services Secretary Alex Azar.