Futures plummet as investors dump stocks on fears of pandemic

(Reuters) – U.S. stock index futures tumbled on Monday as investors scurried to perceived safe-haven assets after a surge in coronavirus cases outside China stoked fears of a bigger impact to global economic growth.

Gold rose to a seven-year high and the inversion between the 3-month and 10-year Treasury yields deepened as a rise in cases in Iran, Italy and South Korea over the weekend added to fears of a pandemic. An inversion of the curve is a classic recession sign. [US/]

Shares of interest rate-sensitive Bank of America Corp, Citigroup Inc, JPMorgan Chase & Co, Goldman Sachs, Wells Fargo & Co and Morgan Stanley lost between 2.1% and 3.7% in premarket trading.

The Dow Jones Industrial Average was indicated to open 700 points lower, with all its 30 blue-chip members trading in the red premarket.

High-growth technology stocks also fell. Apple Inc shed 3.6% as data showed sales of smartphones in China tumbled by more than a third in January.

Chipmakers including Advanced Micro Devices Inc, Micron Technology Inc and Nvidia Corp, which are heavily reliant on China for revenue, slid between 6.3% and 7.2%.]

The CBOE Volatility Index, a barometer of expected near-term stock market volatility, jumped to a six-month high.

At 7:40 a.m. ET, Dow e-minis were down 752 points, or 2.59%. S&P 500 e-minis were down 82.5 points, or 2.47% and Nasdaq 100 e-minis were down 261.75 points, or 2.77%.

Wall Street’s main stock indexes had risen to record highs last week on optimism that the global economy would be able to snap back after an initial hit, supported by central banks.

In a bright spot, Gilead Sciences Inc, whose antiviral remdesivir has shown promise in monkeys infected by a related coronavirus, rose 2.9%.