US STOCKS-Wall St to snap record three-day surge as virus threat intensifies

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* U.S. House approves $2 trillion aid package
* March consumer sentiment drops to 3-1/2-year low
* S&P 500 on track for worst Q1 on record
* Banks stocks fall, tracking Treasury yields
* Boeing set to snap four-day stellar rally
* Indexes tumble: Dow 3.23%, S&P 2.93%, Nasdaq 2.98%

(Updates to early afternoon, adds comment)
By Uday Sampath Kumar and Medha Singh
March 27 (Reuters) - Wall Street's historic three-day bounce
was stalled on Friday as doubts about the fate of the U.S.
economy resurfaced with the number of coronavirus cases in the
country skyrocketing.
The United States surpassed China as the nation with the
most number of COVID-19 cases, putting more pressure on
lawmakers to flood the country with cash to support businesses
and families. "We have still not fully understood the degree of the
economic impact," said Massud Ghaussy, senior analyst at Nasdaq
IR Intelligence in New York.
"Currently, from a policymaker's perspective, it's a
relative balance between managing the spread of the virus and
opening the economy."
The U.S. House of Representatives on Friday approved a $2.2
trillion aid package - the largest in American history - to help
individuals and companies cope with an economic downturn caused
by the coronavirus outbreak and provide hospitals with urgently
needed medical supplies. The bill now goes to President Donald Trump who is expected
to promptly sign it into law.
The stimulus bill and unprecedented policy easing by the
Federal Reserve have put the S&P 500 .SPX on course for its
best week in over a decade, but it is still down about 14% in
March and on pace for its worst first quarter ever.
The Dow Jones .DJI , technically establishing a bull market
on Thursday, is on course for its biggest weekly gain since
1938, largely helped by a stunning four-day rally for Boeing Co
BA.N .
But with growing fears of a global recession, traders expect
more wild swings in financial markets until there are signs of
new virus cases peaking and sweeping restrictions placed on
entire countries being lifted. "(Stimulus) is not necessarily enough to make people say,
'I've got to run out and buy stocks,'" said Rick Meckler, a
partner at Cherry Lane Investments in New Jersey. "That's going
to take more time."
Latest macroeconomic indicators are starting to offer a
glimpse of the economic devastation from the crisis as the
lockdown of major cities upends the lives of millions of
Americans.
U.S. consumer sentiment dropped to a near 3-1/2-year low in
March, according to a survey released on Friday, a day after
data showed a record 3 million surge in jobless claims last
week. At 1:19 p.m. ET the Dow Jones Industrial Average .DJI was
down 729.15 points, or 3.23%, at 21,823.02, the S&P 500 .SPX
was down 77.13 points, or 2.93%, at 2,552.94 and the Nasdaq
Composite .IXIC was down 232.35 points, or 2.98%, at 7,565.19.
Delta Airlines DAL.N American Airlines AAL.O and United
Airlines UAL.O fell between 5.6% and 6.5% as U.S. Treasury
Secretary Steve Mnuchin said the aid designated for airlines in
the package was not a bailout and that taxpayers would need to
be compensated. Boeing shed 8.3% after gaining as much as 90% this week, as
Mnuchin said the planemaker had no intention of participating in
the package.
The banking index .SPXBK fell 4.5%, tracking U.S. Treasury
yields, as investors sought safety in high-quality assets.
The energy index .SPNY was the biggest percentage loser
among the 11 major S&P sectors, slipping 5.9%, following a drop
in oil prices.
Declining issues outnumbered advancers more than 4-to-1 on
the NYSE and 3-to-1 on the Nasdaq.
The S&P index recorded no new 52-week high and one new low,
while the Nasdaq recorded six new highs and 27 new lows.