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* Fed says economy is ok but would provide appropriate
support
* Wall Street averages regain ground at last minute
* Financials are biggest drag on S&P
* Dow down 1.39%, S&P down 0.82%, Nasdaq up 0.01%
(Updates to late afternoon, adds commentary, NEW YORK dateline,
changes byline)
By Sinéad Carew
New York, Feb 28 (Reuters) - The S&P 500 fell for the
seventh straight day on Friday and the benchmark index suffered
its biggest weekly drop since the 2008 global financial crisis
on growing fears the fast-spreading coronavirus could push the
economy into recession, although stocks regained some ground
right at the end of a volatile session.
The Dow and the Nasdaq also registered their deepest weekly
percentage losses since October 2008.
The Nasdaq managed to eke out an 0.01% gain after plunging
as much as 3.5% during the session. After falling as much as
4.2% - more than 1,000 points - the Dow ended the day down 1.4%.
But, after the bell, S&P 500 e-mini futures were up
about 1% and the Invesco QQQ Trust ETF was up 1.3% in extended
trade.
On Thursday, all three indexes had confirmed corrections by
finishing more than 10% below their closing record highs.
Equities found some support after U.S. Federal Reserve Chair
Jerome Powell said the fundamentals of the American economy
remained strong and that the central bank would act as
appropriate to provide support.
But investors had spent most of the day dumping equities for
the safety of U.S. Treasuries, pushing 10-year yields to their
fourth record low this week.
The virus spread further on Friday, with cases reported for
the first time in at least six countries across four continents,
battering markets and leading the World Health Organization
(WHO) to raise its impact risk alert to "very high."
Some investors voiced concerns about heading into a weekend
where they could not trade on new reports about the virus.
"To get an all-clear sign, the market needs evidence it's
under control, no flaring up in new countries and that we don't
get a significant outbreak in the United States," said Jack
Janasiewicz, chief portfolio strategist for Natixis Investment
Managers.
Janasiewicz saw the spread of the virus China as a prompt
to reduce exposure to riskier assets, and said the next
milestone for further risk cuts would be a U.S. outbreak.
The Dow Jones Industrial Average fell 357.28 points,
or 1.39%, to 25,409.36; the S&P 500 lost 24.54 points, or
0.82%, to 2,954.22; and the Nasdaq Composite added 0.89
point, or 0.01%, to 8,567.37.
The CBOE volatility index, also known as Wall Street's fear
gauge ended the day near its session low, up 0.95 point at
40.11, after rising as high as 49.48.
Of the S&P's 11 major sectors, the rate-sensitive financial
index weighed the most on the benchmark S&P 500 index,
ending the day down 2.6%. The utilities sector was the
S&P's biggest percentage loser with a 3.3% drop. Real estate
and consumer staples - also rate-sensitive
sectors that are often seen as safe havens - both fell more than
2%.
Yet the energy, technology and
communications services index all showed gains for the
day.
Declining issues outnumbered advancing ones on the NYSE by a
3.39-to-1 ratio; on Nasdaq, a 1.95-to-1 ratio favored decliners.
The S&P 500 posted no new 52-week highs and 129 new lows;
the Nasdaq Composite recorded 19 new highs and 538 new lows.
Trading was brisk on U.S. exchanges with 19.31 billion
shares changing hands compared with a 9.25 billion-share average
for the last 20 days.
(Additional reporting Lewis Krauskopf, April Joyner and
Caroline Valetkevitch in New York, by Medha Singh and Shreyashi
Sanyal in Bengaluru; Editing by Nick Zieminski and Jonathan
Oatis)