International investors believe coronavirus is truly a global phenomenon: Stock markets around the world are all down 10% to 12% from their recent highs.
While travel-related stocks are taking very large hits, the entire global stock market has been taken down in recent weeks.
All this has occurred in a short period — the S&P 500 hit historic highs just last Wednesday, which leaves veteran trader Matt Maley, Chief Market Strategist at Miller Tabak, marveling at the speed of the decline.
“You don’t usually fall this fast from an all-time high,” he said. “They usually don’t throw in the towel until they see a failed rally, but this is a true black-swan event. Markets don’t like uncertainty, but this is the ultimate uncertainty because there is no clear time frame.”
Big-cap stocks have all been taken down at least 10% from their recent highs, including many technology stocks:
Tech stocks in correction
(% from 52-week highs)
Major market sub-sectors are all also down 10% to 15%:
Markets sub-sectors in correction
(from 52-week highs)
In the absence of clear information on fundamentals — on the extent of the global economic impact of coronavirus–traders have turned to technicals. “Everyone is watching the 200-day moving average,” Maley said, which is 3,047.