The coronavirus is officially a pandemic now, and that fact wreaked havoc on the stock market today, with major indices falling 4.7% (the Nasdaq Composite), 4.9% (the S&P 500), even 5.9% (the Dow Jones Industrial Average).
It wasn't a fun day to be an investor. Perhaps the best illustration of that fact was toymaker Mattel (NASDAQ:MAT), which saw its stock fall 11%.
Why did Mattel fall? That's actually a very good question.
Sure, on the one hand, we know that about 70% of all toys sold worldwide -- whether branded "Mattel" or under some other name -- are actually made in China. That certainly doesn't bode well for Mattel's ability to import toys to America to sell this Christmas season.
And yet, as my fellow Fool Billy Duberstein pointed out yesterday, the coronavirus news coming out of China is actually remarkably good, and stands in marked contrast to the news we're seeing elsewhere around the world. In all the nation of China, the most populous nation on Earth, only 19 new cases of COVID-19 were reported yesterday.
The coronavirus, it seems, may be starting to burn itself out.
Try telling that to investors, though, who right now are much more concerned about how the coronavirus is affecting them closer to home -- their homes.
With markets panicking and shoppers staying away from stores, I suspect no one's thinking too much about buying toys for the kids nine months from now. Irrational though the fear may be, they're more worried about whether there will be a "nine months from now."
Until the economic situation settles down and more countries start showing positive trends resembling the one we're finally seeing emerge in China, pessimism is probably going to rule the day. Companies like Mattel, which depend on a normal world to encourage shoppers to make ordinary, everyday discretionary purchases, may be in for a rocky ride.