Stocks slide amid coronavirus fears, oil price drop
NEW ORLEANS, La. (WVUE) - Stocks went into a steep slide on Wall Street amid Coronavirus fears and a crash in oil prices.
“The market was down about 18, 1900 points and it got to a point where they actually had to stop trading when the market goes down certain increments, they stop trading for 15 minutes,” says Jim Spiro.
Over 113,000 cases of the virus are confirmed worldwide and fears the spreading disease will derail the global economy fuels the investment jitters.
Spiro, who is the managing director for Morgan Stanley, isn’t surprised but says it can create worries for some investors.
“Hey, where is the bottom? Is this going to go down to zero and I don’t know. I can tell you that by the time the person reads or hears or senses the bottom of the market place, the market will have reasonably moved in advance of that.”
The crash in oil priced spread alarm throughout the market as well.
The price of oil sank 20 percent after Russia refused to roll back production in response to falling demand in Saudi Arabia signaled it will ramp up on its own output.
“Reduction in oil prices translate immediately in the production of state tax revenue. But what’s happened most recently, Louisiana doesn’t produce much crude oil anymore,” says Professor Eric Smith with Tulane’s Energy Institute.
Smith says Louisiana will likely not take a big hit from the crude oil prices right away.
“Because we are simply the middle man, we’re processing it. Using our refineries and so forth. Long term with this going on for years rather than months, you’ll end up with some of the plants in Louisiana shutting down and if that happens, we’ll lose immediate payroll,” says Smith.
But there’s no way of knowing how long it will last. Spiro says the stock market can be very predictable.
“There’s and old saying I try to convey to clients and it’s a fairly useful one. That by the time you see the robins, the Spring has already come and I hope people take that to heart because by the time a person can really sense things have improved, the market will have began to move so you can never really sense the top and bottoms,” says Spiro.
President Donald Trump lashed out about the plunging stock market and convened a meeting of his top economic advisors to address what to do about it.
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