• Almost 3,000 people in China have the virus and 81 have died
  • Dow fell more than 500 points at opening
  • Crude oil prices plunged

U.S. stocks traded deeply lower at Monday ’s opening on panic selling spurred by more bad news related to the spreading coronavirus in China.

The Dow Jones Industrial Average dropped 404.35 points to 28,585.38 while the S&P 500 fell 45.08 points to 3,250.39 and the Nasdaq Composite Index tumbled 157.55 points to 9,157.36.

Chinese health officials reported that there are now almost 3,000 confirmed cases of the coronavirus in China with at least 81 fatalities.

The National Health Commission said the incubation period for the coronavirus is about 10 days and that even during that period it is contagious.

The World Health Organization’s director general, Dr. Tedros Adhanom Ghebreyesus, is flying to China to meet with government officials. On Monday, Chinese Premier Li Keqiang traveled to Wuhan, the epicenter of the outbreak in Hubei province. Wuhan and more than a dozen other cities with total population of more than 50 million are in lockdown.

China has also extended the Lunar New Year holiday to Feb. 2 in order to dissuade people from assembling in public.

“Uncertainty continues to weigh on markets with increasing concerns about the deadly and contagious coronavirus, which continues to spread,” Liz Kendall, senior economist at ANZ Research, wrote in a morning note.

The U.S. reported its fifth confirmed case in Arizona on Sunday, while Japan, Thailand, Singapore, Australia, France and other countries have also reported cases.

U.S. President Donald Trump tweeted: “We are in very close communication with China concerning the virus. Very few cases reported in USA, but strongly on watch. We have offered China and President Xi any help that is necessary.”

“China is the biggest driver of global growth so this couldn’t have started in a worse place,” said Alec Young, managing director of global markets research at FTSE Russell. “Markets hate uncertainty, and the coronavirus is the ultimate uncertainty in that no one knows how badly it will impact the global economy.”

“Investors tapped the brakes last week as overbought conditions and concerns over the coronavirus created a few speed bumps on the path to record-highs,” said Craig Johnson, chief market technician at Piper Sandler. “We continue to believe there is an elevated risk for a deeper pullback to develop.”

“Any economic shock to China’s colossal industrial and consumption engines will spread rapidly to other countries through the increased trade and financial linkages associated with globalization,” Stephen Innes, chief Asia market strategist at Axitrader, wrote in a note Monday. “I’m starting to think cash is the right place to be for the next few weeks.”

Markets in mainland China and Hong Kong were closed for the lunar new year holiday. Japan’s Nikkei-225 plunged 2.03%.

In Europe markets finished broadly lower, as Britain’s FTSE-100 dropped 2.29%, France’s CAC-40 fell 2.68% and Germany’s DAX plunged 2.74%.

Crude oil futures dropped 2.92% at $52.61 per barrel and Brent crude plunged 2.56% at $58.13. Gold futures gained 0.64%.

The euro slipped 0.09% at $1.016 while the pound sterling fell 0.24% at $1.3043.