The US markets ended sharply lower on Wednesday as investors worried that rising coronavirus cases in many American states will set back economic recovery. Fueling the renewed concerns, Florida and California both reported their single biggest daily increases in new cases of COVID-19. Florida's Department of Health confirmed 5,508 new cases on Tuesday, while the California Department of Public Health reported an additional 7,149 cases. New York, New Jersey and Connecticut announced 14-day quarantines on visitors from states with high COVID-19 infection rates. The travel advisory, which impacts residents of nine states, raises concerns about the pace of business activity resuming after lockdowns imposed to contain the spread of the pandemic. The nation's seven-day average of daily new Covid-19 cases spiked more than 30 percent compared with a week ago.
On the international trade front, the US is considering imposing tariffs on some $3.1 billion worth of goods from France, German, Spain and the UK, on products, including beer, gin, olives and trucks, also creating headwinds for stocks and igniting fears of a fresh trade war as the American economy reels from the pandemic. The Trump administration also has been threatening to re-imposing tariffs on imports of aluminum from Canada on July 1 as the new USMCA, or the United States Mexico Canada Agreement, which replaced the North American Free Trade Agreement, is set to take effect. Meanwhile, the International Monetary Fund (IMF) cut its economic forecast for 2020, saying that the coronavirus pandemic has caused an unprecedented decline in global activity. The IMF dropped its global economic growth expectations for this year to negative 4.9%. That’s almost two percentage points lower than three months ago.
Dow Jones Industrial Average fell 710.16 points or 2.72 percent to 25,445.94, Nasdaq declined 222.2 points or 2.19 percent 9,909.17 and S&P 500 was down by 80.96 points or 2.59 percent to 3,050.33
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