US close: Markets fall sharply after unscheduled Fed rate cut

US stocks finished sharply lower on Tuesday, more than reversing their early gains as an unscheduled rate cut from the Federal Reserve strengthened fears of a coronavirus-stoked recession.

The Dow Jones Industrial Average ended the session down 2.94% at 25,917.41, the S&P 500 lost 2.81% to 3,003.37, and the Nasdaq Composite was 2.99% weaker at 8,684.09.

At the open, the Dow had added 86.20 points after seeing out the previous session nearly 1,300 points firmer.

The blue-chip index had started the week reclaiming some of its recent losses with its biggest percentage gain since March 2009, amid expectations that the Federal Reserve would again cut rates - expectations which were sated on Tuesday.

In its unscheduled announcement, the US central bank cut its benchmark rate to between 1% and 1.25% from between 1.5% and 1.75%.

"The fundamentals of the US economy remain strong. However, the coronavirus poses evolving risks to economic activity," the Fed said in a statement.

"In light of these risks and in support of achieving its maximum employment and price stability goals, the Federal Open Market Committee decided today to lower the target range for the federal funds rate.

“The committee is closely monitoring developments and their implications for the economic outlook and will use its tools and act as appropriate to support the economy,” it said.

Investors were also digesting the outcome of a G7 conference call on the Covid-19 coronavirus outbreak, during which finance ministers and central bankers vowed to "use all appropriate policy tools" to help combat the economic impact of the outbreak.

"Alongside strengthening efforts to expand health services, G7 finance ministers are ready to take actions, including fiscal measures where appropriate, to aid in the response to the virus and support the economy during this phase," read the statement.

"G7 central banks will continue to fulfil their mandates, thus supporting price stability and economic growth while maintaining the resilience of the financial system."

Following the news, the 10-year Treasury note yield rose 3.8 basis points to 1.126%, while the two-year note rate fell 1.6 basis points to 0.810%.

No major data releases were scheduled for Tuesday.

In equities, discount department store chain Target was down 2.95% after its fourth quarter revenue missed market expectations, even though profit and same-store sales beat forecasts.

Its sector peer Kohl’s was 2.63% weaker even after it beat earnings expectations, and raises its dividend.

General Electric was down 2.94%, one day after it shot up more than 3% following an upgrade from JP Morgan, while online dating giant Match Group was 3.43% weaker amid fears that the coronavirus outbreak could put people off dating, and thus Match’s portfolio of apps.

Dow Jones - Risers

Coca-Cola Co. (KO) $56.06 0.25%
Dowdupont Inc. (DWDP) $30.52 0.00%
Home Depot Inc. (HD) $227.94 -0.87%
United Technologies Corp. (UTX) $132.53 -1.15%
Procter & Gamble Co. (PG) $118.17 -1.16%
McDonald's Corp. (MCD) $199.51 -1.50%
Pfizer Inc. (PFE) $34.30 -1.66%
Travelers Company Inc. (TRV) $125.31 -1.86%
Nike Inc. (NKE) $90.93 -1.89%
Chevron Corp. (CVX) $94.39 -2.28%

Dow Jones - Fallers

American Express Co. (AXP) $108.01 -5.15%
3M Co. (MMM) $145.24 -5.08%
Microsoft Corp. (MSFT) $164.51 -4.79%
Exxon Mobil Corp. (XOM) $51.30 -4.79%
Unitedhealth Group Inc. (UNH) $261.40 -4.29%
Walgreens Boots Alliance, Inc. (WBA) $46.12 -4.14%
International Business Machines Corporation (CDI) (IBM) $128.90 -4.02%
Intel Corp. (INTC) $55.97 -3.80%
JP Morgan Chase & Co. (JPM) $116.96 -3.75%
Visa Inc. (V) $185.73 -3.43%

S&P 500 - Risers

Newmont Corporation (NEM) $49.73 6.19%
CME Group Inc. (CME) $216.07 3.19%
Lennar Corp. Class A (LEN) $64.24 2.59%
Welltower Inc (WELL) $77.01 2.33%
eBay Inc. (EBAY) $36.72 2.11%
Tractor Supply Company (TSCO) $93.14 1.81%
Vulcan Materials Co. (VMC) $128.08 1.78%
Thermo Fisher Scientific Inc. (TMO) $310.36 1.77%
Cabot Oil & Gas Corp. (COG) $14.79 1.65%
Intercontinental Exchange Inc (ICE) $94.94 1.65%

S&P 500 - Fallers

Unum Group (UNM) $22.79 -8.99%
Brighthouse Financial, Inc. (BHF) $34.16 -8.81%
Charles Schwab Corp. (SCHW) $38.30 -8.77%
Svb Financial Group (SIVB) $198.63 -8.36%
Lincoln National Corp. (LNC) $44.25 -8.35%
Raymond James Fin Corp. (RJF) $80.23 -7.93%
Hanesbrands Inc. (HBI) $12.35 -7.56%
Alliance Data Systems Corp. (ADS) $79.68 -7.42%
Halliburton Co. (HAL) $15.95 -7.38%
Comerica Inc. (CMA) $51.00 -7.31%

Nasdaq 100 - Risers

NetEase Inc. Ads (NTES) $319.47 3.03%
eBay Inc. (EBAY) $36.72 2.11%
Tesla Inc (TSLA) $745.51 0.25%
Celgene Corp. (CELG) $108.24 0.00%
Shire Plc Ads (SHPG) $179.20 0.00%
Intuitive Surgical Inc. (ISRG) $558.27 -0.14%
Electronic Arts Inc. (EA) $106.70 -0.18%
Seagate Technology Plc (STX) $50.21 -0.32%
Charter Communications Inc. (CHTR) $495.03 -0.42%
Regeneron Pharmaceuticals Inc. (REGN) $461.55 -0.69%

Nasdaq 100 - Fallers

Qurate Retail Inc. (QRTEA) $5.93 -8.77%
Marriott International - Class A (MAR) $114.28 -7.06%
Mylan Inc. (MYL) $16.29 -6.81%
Microchip Technology Inc. (MCHP) $89.41 -6.10%
Autodesk Inc. (ADSK) $180.55 -5.39%
Facebook Inc. (FB) $185.89 -5.37%
American Airlines Group (AAL) $17.85 -5.36%
Western Digital Corp. (WDC) $56.93 -5.18%
Micron Technology Inc. (MU) $51.80 -5.11%
Wynn Resorts Ltd. (WYNN) $102.44 -5.10%