US STOCKS-Recession fears pummel Wall St as virus damage grows

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* S&P 500 down 6% after flirting with fresh trading halt
* Boeing slumps after call for $60 bln lifeline
* General Mills ups forecast on bulk-buying

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By Medha Singh and Sanjana Shivdas
March 18 (Reuters) - Wall Street's four-week slump deepened
on Wednesday as investors priced in a complete breakdown in
business activity and consumer spending from the coronavirus
pandemic.
With airports and hotels emptying and airlines asking staff
to take unpaid leave to stem losses, the S&P 1500 airlines index
.SPCOMAIR sank 16.8%, while shares in Hilton HLT.N , Marriott
MAR.O and Hyatt H.N hotels fell by 20% to 30%.
President Trump's request for Congress to approve $500
billion in cash payments to taxpayers along with $50 billion in
loans for airlines did little to stem the bleeding and by noon
the Dow and S&P were both down more than 6% on the day.
Shares in Boeing Co BA.N , long a symbol of U.S. tech and
industrial power, sank another 15.2% and are now down more than
60% since the start of the year.
"We're going to have massive disruption and dislocation in
our economy," said Keith Bliss​, managing partner at iQ Capital
in New York.
"People are conflating what's going on with the coronavirus
with what happened in the global financial crisis."
With Trump activating disaster management agency Fema across
the country, Senate leader Mitch McConnell said it would vote on
coronavirus legislation at 2 p.m. et.
Wall Street's main indexes had bounced on Tuesday from a
massive selloff a day earlier, as the Trump administration
pressed for a $1 trillion stimulus package and the Federal
Reserve relaunched a plan to purchase short-term corporate debt.
But dramatic stimulus measures have only provided
short-lived bounces in equities with investors factoring in a
global recession and estimates for the duration of the damage
extending into the summer.
Although the Trump administration sought more than $150
billion for additional loans to "distressed economic sectors",
including airlines on Wednesday, the benchmark S&P 500 .SPX
slipped 5.1%. The index was also inching close to the 7% threshold that
triggers a 15-minute trading halt - a familiar feature of two
weeks of big swings in markets that have shattered Wall Street's
longest ever bull run.
Worries about mass debt defaults or writedowns pressured
U.S. lenders, sending the S&P 500 banking subsector .SPXBK
down 6.9%.
"If you have lots of companies drawing down their credit
facilities to make sure that they can keep their businesses
running then it's a reasonable assumption that banks will have
some credit problems down the road," Bliss said.
Apple Inc AAPL.O dropped 2.7% as analysts anticipated a
significant blow to its business from temporary store closures.
Even Cheerios maker General Mills Inc GIS.N , which raised its
profit forecast citing consumer bulk-buying, fell 3.1%.
Boeing Co BA.N , just a year ago seen as a perpetual growth
stock and , has now lost more than 60% of its value in this
quarter, while the market overall has fallen by around a third
since scaling record highs mid-February - or around $7 trillion
in value.
The collapse into a bear market, among the fastest in
history, has spurred some calls for a pause in trading. Treasury
Secretary Steven Mnuchin late on Tuesday reiterated the
administration will keep markets open, while suggesting trading
hours could be shortened at some point.
The idea of shortened hours drew immediate opposition from a
number of leading investors and exchange managers, who said it
would harm the market's credibility. At 11:52 a.m. ET, the Dow Jones Industrial Average .DJI
was down 1,170.76 points, or 5.51%, at 20,066.62, while the S&P
500 was down 128.82 points at 2,400.37. The Nasdaq Composite
.IXIC was down 303.01 points, or 4.13%, at 7,031.77.
In a bright spot was Walmart Inc WMT.N , up 5.9%, after
Credit Suisse said the retailer would benefit from a structural
change in consumer behaviour towards online shopping in the wake
of the COVID-19 situation.
Kroger Co KR.N jumped 8.2% while Costco Wholesale Corp
COST.O rose 1.2%.
Energy stocks tumbled nearly 10% as oil prices crashed
leading declines among all 11 S&P sectors.
Declining issues outnumbered advancers about 13-to-1 on the
NYSE and 6-to-1 ratio on the Nasdaq.
The S&P index recorded five new 52-week highs and 220 new
lows, while the Nasdaq recorded eight new highs and 681 new
lows.