Updated at 2:49 p.m. ET
U.S. stock indexes fell sharply Monday, a day after the Federal Reserve aggressively cut interest rates to near zero in a bid to stop the economy from crashing. The Dow Jones Industrial Average was down about 2,200 points, or nearly 10%, as coronavirus measures rapidly expanded.
The deep stock market selloff reflects broad concerns that despite these economic measures, the U.S. economy is likely heading toward a recession.
Many parts of the economy have abruptly come to a standstill. Government orders to temporarily close restaurants and bars in New York City, Los Angeles and Chicago and recommendations to ban groups of more than 50 people were among the latest attempts to stem the spread of the coronavirus.
The hard-hit airline industry is seeking $50 billion in aid and loans from the federal government. "The rapid spread of COVID-19, along with the government and business-imposed restrictions on air travel, are having a unprecedented and debilitating impact on U.S. airlines," the industry group Airlines for America said.
Leaders of the Group of 7 — the U.S., Canada, France, Germany, Italy, Japan and United Kingdom — agreed to work together to speed up and coordinate on the global response to the pandemic.
"We are mobilizing the full range of instruments, including monetary and fiscal measures, as well as targeted actions, to support immediately and as much as necessary the workers, companies, and sectors most affected," the G-7 said in a statement.
The S&P 500 index fell nearly 11% after temporary trading halts were lifted on the New York Stock Exchange, but later recovered somewhat to a drop of about 9%.
A 7% drop in the S&P 500 automatically forces trading to stop for 15 minutes, which has happened three times in the past week.
On Sunday evening, the Fed took the extraordinary move of cutting rates by one percentage point to near zero. The last time it moved them that low was in 2008, during the financial crisis.
"The effects of the coronavirus will weigh on economic activity in the near term and pose risks to the economic outlook," the Fed said in a statement.
The drops on Wall Street follow steep falls in Europe, where stock indexes were down as much as 11% Monday.
Oil prices fell nearly 9% to about $29 per barrel. They're down more than 50% so far this year.
In cutting its key interest to zero, the Fed has not left itself much room to act on rates in the future. It has basically given up a major policy tool — one that it would need if the economy tumbles into recession.
The Fed also said it will buy $700 billion of Treasurys and other government securities to help grease the financial markets. It took similar steps, known as quantitative easing, during the financial crisis.
The Fed said it's "prepared to use its full range of tools to support the flow of credit to households and businesses."
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