UPDATE 3:15 p.m. TUESDAY, MARCH 3, 2020
NEW YORK (AP) -- The Dow Jones Industrial Average dropped 785 points and bond prices surged after an emergency interest-rate cut by the Federal Reserve failed to reassure markets racked by worries that a fast-spreading virus outbreak could lead to a recession.
The yield on the 10-year Treasury note dropped below 1% for the first time.
The Dow industrials lost 2.9% to 25,917. It had surged 5% a day earlier on hopes for a broader set of stimulus measures.
The S&P 500 index fell 2.8% and is now 11% below the record high it set two weeks ago.
The Nasdaq fell 3%.
ORIGINAL STORY
By MARTIN CRUTSINGER and CHRISTOPHER RUGABER
AP Economics Writer
WASHINGTON (AP) -- In a surprise move, the Federal Reserve cut its benchmark interest rate by a sizable half-percentage point in an effort to support the economy in the face of the spreading coronavirus.
Chairman Jerome Powell said at a news conference that the virus "will surely weigh on economic activity both here and abroad for some time."
It was the Fed's first rate cut since last year, when it reduced its key short-term rate three times.
It is also the first time the central bank has cut its key rate between policy meetings since the 2008 financial crisis and the largest rate cut since then.
