Wall Street opens sharply lower as risk aversion takes over
- Coronavirus infections rose sharply after change in counting method.
- CBOE Volatility Index rises more than 7% on Thursday.
- Risk-sensitive energy and tech shares suffer heavy losses.
Wall Street's main indexes started the day sharply lower on Thursday as resurfacing coronavirus fears weigh on risk-sensitive assets. As of writing, the CBOE Volatility Index, Wall Street's fear gauge, was up 7.3% on a daily basis to reflect the risk-averse environment.
China has reported a sharp upsurge in the number of confirmed coronavirus infection cases after changing the method of counting and triggered a flight-to-safety as investors realized that the outbreak would be more severe than initially anticipated.
Energy and tech shares underperform
At the moment, the Dow Jones Industrial Average is down 0.4% on the day, the S&P 500 and the Nasdaq Composite are erasing 0.3% and 0.5%, respectively. Among the 11-major S&P 500 sectors, the risk-sensitive Energy Index and the Technology Index are both down around 0.5%. On the other hand, the defensive Utilities Index is the only major sector in the positive territory in the early trade.
Author
Eren Sengezer
FXStreet
As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.
