SAN FRANCISCO- The S&P 500 suffered its worst day in two years on Monday as a surge in coronavirus cases outside China rattled investors already worried about valuations following recent record highs.
The S&P 500’s 3.35 percent slump was the leading US stock index’s deepest one-day loss since February 2018, when Wall Street was in a correction.
The fear in Monday’s session came after investors in recent months often downplayed the overall risk related to the new coronavirus. Monday’s drop wiped out all of the S&P 500’s gains for 2020.
“With stock prices and valuations still near cycle highs, the risk of a worsening virus outbreak has not been priced into the market to a great extent,” Truist/SunTrust Advisory Chief Market Strategist Keith Lerner wrote in a client note.
S&P 500 sector indexes are mostly still close to their record highs, with the exception of energy. The S&P information technology index tumbled 4.2 percent on Monday, slammed by losses for chipmakers and Apple, which rely more than most other US companies on China. The information technology index is down over 7 percent from its record high on Feb 19, but remains up almost 4 percent in 2020. – Reuters
