US STOCKS-Wall St pounded as Fed's shock move raises virus impact alarm

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* Financial sector slumps on Fed's surprise rate cut
* Tech plummets as Apple, Microsoft weigh
* Retail stocks tumble as Nike, Lululemon to close U.S.
stores
* Energy stocks plunge as oil prices fall below $30/barrel
* Indexes down: Dow 9.14%, S&P 8.54%, Nasdaq 8.33%

(Updates to early afternoon)
By Sanjana Shivdas and Medha Singh
March 16 (Reuters) - U.S. stock indexes plunged about 8% on
Monday, as investors dumped risky assets for cash after the
Federal Reserve's drastic move to cut interest rates to near
zero amplified worries over the extent of damage from the
coronavirus pandemic.
The benchmark index slid as much as 11.4% early in the
session, shedding about $2 trillion in market value, before
bargain hunting helped the main indexes claw back some losses.
Trading on Wall Street's three main stock indexes was halted
for 15 minutes shortly after the open as the S&P 500 index
.SPX plunged 8%, crossing the 7% threshold that triggers an
automatic cutout.
The Fed's second emergency interest rate cut in less than
two weeks and its pledge to purchase more than $700 billion in
assets came ahead of its scheduled policy meeting on Tuesday and
Wednesday, adding to the alarm about the pandemic that has
paralyzed parts of the global economy and squeezed company
revenue. "There is a risk when the Fed takes such aggressive measures
that investors say, 'Gee, do they know something that we don't
know?'," said Danielle DiMartino Booth, chief strategist at
Quill Intelligence in Dallas, Texas.
"I don't think that with the way the markets are behaving,
the central banks right now have much in the way of options.
They have to be aggressive right now."
Underscoring the economic blow of the outbreak, severe virus
containment measures sent China's factory production tumbling at
its fastest pace in three decades. Rate-sensitive financial stocks .SPSY tumbled 11.1%,
leading declines among the major S&P sectors. The sector also
came under pressure after the big U.S. banks halted their share
buybacks. Energy stocks .SPNY tracked a near 10% slump in oil
prices, while technology stocks .SPLRCT lost 9.2%.
Heavyweights Apple Inc AAPL.O , Microsoft Corp MSFT.O and
Facebook Inc FB.O fell at least 7% and were the biggest drags
on the S&P 500.
Wall Street's fear gauge .VIX jumped 21.15 points to
78.98.
The markets should stay open despite the intense volatility,
the head of the U.S. securities regulator said, quashing
speculation that the government might shut down the country's
exchanges to stop the plunge in stock prices. As bars, restaurants, theaters and movie houses in New York
and Los Angeles were ordered shut, U.S. states pleaded with the
Trump administration to coordinate a national response to the
outbreak. Nike Inc NKE.N , Lululemon Athletica Inc LULU.O and Under
Armour Inc UAA.N said they would close stores in the United
States and some other markets, dragging the S&P 500 retail index
.SPXRT 8% lower.
The S&P 1500 airlines index .SPCOMAIR slumped 9.4% after
United Airlines Holdings Inc UAL.O booked $1.5 billion less
revenue in March and warned employees that planes could be
flying nearly empty into the summer. At 12:55 p.m. ET, the Dow Jones Industrial Average .DJI
was down 2,119.07 points, or 9.14%, at 21,066.55 and the S&P 500
.SPX was down 231.58 points, or 8.54%, at 2,479.44. The Nasdaq
Composite .IXIC was down 656.07 points, or 8.33%, at 7,218.81.
Declining issues outnumbered advancers for a 13.24-to-1
ratio on the NYSE and a 9.58-to-1 ratio on the Nasdaq.
The S&P index recorded no new 52-week highs and 325 new
lows, while the Nasdaq recorded three new highs and 1,238 new
lows.
The Dow will wipe out the entire Trump-bump if the blue-chip
index falls another 1,500 points from current levels. The index
would trade at levels seen before Donald Trump assumed office on
Jan.20, 2017.