Why have stocks dropped off only because of coronavirus?
- AmyLv 71 month agoFavorite Answer
A huge proportion of the goods that American companies sell are manufactured in China or use parts manufactured in China. The quarantines and fear of travel are disrupting those factories and exports. With the virus spreading to other countries, more supply chains will be cut off.
So stocks of companies directly dependent on China are crashing. This disrupts all the companies dependent on THEM.
- oldprofLv 71 month ago
Simple, sick people can't go to work. And exposed people can't go to work for fear they are carrying the virus.
Without people to do the work, enterprises cannot produce their goods and services. And the market sees that and plunges because profits are no longer predicted.
And roughly 50% of the goods we receive from overseas come from China, the hardest hit of all the nations with COVID19.
- Anonymous1 month ago
Its a much bigger deal. Supply chain is stopped. Will take months to make things right if everything was better tomorrow. And it won't be. That means lost sales & profits for many companies.