Traders work on the floor of the New York Stock Exchange (NYSE) on March 03, 2020 in New York City.

Spencer Platt | Getty Images

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5:45 am: Major averages set to crater 5% at the open, Dow on track for 1,300-point drop

Monday is shaping up to be a bloodbath on Wall Street. U.S. stock futures are indicating a 5% drop for the major averages at the open, with the Dow set to decline more than 1,300 points.

The sharp move lower comes as investors brace for the economic fallout from the spreading coronavirus, while a shocking all-out oil price war added to the anxiety.

The sharp declines in the futures market signaled more turbulence ahead after a roller-coaster week that saw the S&P 500 swing up or down more than 2.5% for four days straight.

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6:43 am: Market is now expecting the Fed to cut short-term rates to zero this month

Less than a week after it implemented an emergency rate cut, markets now expect the Federal Reserve soon to take its benchmark rate back to zero, where it was during the financial crisis. The fed funds futures market is assigning a 73.5% probability to a 100 basis point cut in March, according to the CME’s FedWatch tracker. There was a 0% probability of that happening as of Friday, but the weekend’s market events changed that. The Federal Open Market Committee meets March 17-18, but the central bank could act before then. – Cox

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