Stocks open sharply lower on Wall Street

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Global stocks, USA government bond yields and oil prices tumbled Thursday, extending losses as investors braced for a drop in business activity and corporate earnings following the spread of the coronavirus.

The virus, which has claimed over 2,700 lives in China, is picking up faster outside China, including in nearby Japan and South Korea as well as more distant Iran and Italy, triggering worries of a global pandemic.

US 10-year notes last fell 2/32 in price to yield 1.317%, from 1.31% late on Wednesday.

The Dow was down more than 900 points but had recovered some by 11 a.m. ET. Saudi Arabia banned foreign pilgrims from entering the kingdom to visit Islam's holiest sites.

West Texas Intermediate crude dipped 3.1 per cent to US$47.30 a barrel, hitting the lowest in 14 months with its fifth straight decline.

Traders work on the floor of the New York Stock Exchange shortly after the opening bell in New York, U.S., February 26, 2020.

At their heart, stock prices rise and fall with the profits that companies make. The S&P 500 lost 72 points, or 2.4%, to 3,043. And Wall Street's expectations for profit growth are sliding away.

Microsoft and Apple were the two worst-performing stocks on the Dow, dropping 6.9 and 6.3 percent respectively.

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"Our reduced forecasts re?ect the severe decline in Chinese economic activity in (the first quarter), lower end-demand for USA exporters, supply chain disruption, a slowdown in United States economic activity, and elevated uncertainty", Goldman said.

Discovery Inc. took a more than 7% hit in early trading on the heels of Thursday's quarterly earnings announcement, even as it reported gains in advertising and distribution revenue.

The S&P 500 was recently trading at its most expensive level, relative to its expected earnings per share, since the dot-com bubble was deflating in 2002, according to FactSet.

"This could lead to more near-term market volatility and pressure stock prices further".

Some investors had been betting that central banks like the U.S. Federal Reserve would counter any economic weakness resulting from the virus with support such as interest rate cuts. They're pricing in a better than two-in-three probability of a cut at the Fed's next meeting in March. Just a day before, they were calling for only a one-in-three chance.

Netflix was among the few media-related stocks to manage a gain amid the broader undertow.

Bucking the trend, 3M Co was up 3% after an analyst upgraded the stock, citing possible benefit from higher sales of respirator masks during the outbreak.

The market's sharp drop this week partly reflects increasing fears among many economists that the US and global economies could take a bigger hit from the coronavirus than they previously thought.

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