The Dow’s opening bell plunge points to a fourth-straight decline on the U.S. stock market Thursday.

Wall Street analysts including Citi are now bracing for a fall of 20% from recent highs.

A drop of that magnitude would constitute a technical bear market and the end of a ten-year upward trend.

The stock market bloodbath continues on Thursday with global stocks plunging for the sixth day straight. The Dow Jones Industrial Average (DJIA) collapsed more than 400 points when the opening bell rang.

And the selling isn’t over yet. According to Wall Street analysts, we may be staring down the barrel of a bear market. Wall Street is bracing for a 20% drop in U.S. stock indices, a move that would signal the end of a ten-year bull market.

Peter Cecchini, chief market strategist at Cantor Fitzgerald LP stated:

Using our forecast for rates, inflation and earnings, and our price-to-earnings model estimate, fair value on the S&P is closer to 2,450.

That would constitute a drop of more than 20% and a technical bear market.

Dow opens to even more bleeding

The Dow fell a step closer to a bear market on Thursday. As of 9:44 am ET, the DJIA had declined by 480.87 points or 1.78% to 26,476.72.

Down roughly 10% from its all-time high, the Dow is now teetering in correction territory.

The S&P 500 and Nasdaq also suffered, plunging 2.05% and 2.42%, respectively.

Bear market incoming?

Cantor Fitzgerald isn’t the only one eyeing up a 20% drop. Citigroup analysts said the S&P 500 would start to look attractive at 2,730 – a further 12% drop from today’s prices and a whisker away from a technical bear market.

Jeremy Hale at Citigroup wrote:

We are reluctant to buy the dip in risk assets just yet … It will likely take a further tightening in financial conditions to force the Fed’s hand into acting. We await signs of a policy response to pull the trigger on risk.

Lori Calvasina of RBC Capital Markets also warned clients of a 20% fall in a note on Thursday. He said the crucial first step is a 10% drop, but if that breaks, all bets are off.

The [S&P 500] could fall to the 2,700–2,900 range for a total drop of 14%–20%.

Coronavirus panic sends Dow Jones into a tailspin

The global stock market rout deepened this week as the coronavirus outbreak spread beyond China. Last night, the U.S. announced the first case of COVID-19 with no link to China. It confirmed fears that community spread in America was inevitable.

President Trump attempted to calm fears and settle investor nerves last night, but to no avail.

The risk to the American people remains very low. We have the greatest experts in the world right here… We are ready to adapt and do whatever we have to as the disease spreads.

The outbreak continues to rattle investors as the economic impact could be in the trillions of dollars. U.S. firms operating in China warned that revenue could slump 50% this year due to the slowdown.

Latest coronavirus numbers

Confirmed cases outside of China continue to expand rapidly. A further 505 cases were confirmed in South Korea overnight, bringing the country’s total to 1,766. A woman in Japan tested positive after initially recovering.

A government official in Italy has placed himself in isolation after one of his staffers tested positive for the coronavirus. The country has reported 400 cases in the northern region near Milan with ten fatalities.

Saudi Arabia suspended tourist and pilgrimage travel into the country in an effort to stop the spread. While Australia warned we are entering a ‘pandemic phase’ even though the World Health Organization still refuses to declare it as such.