Storm brings economy of US East Coast to a halt

The massive storm bashing the US East Coast froze commerce, shut down stock exchanges for the first time since the 9/11 attacks and idled millions of workers Monday, laying siege to an economy still trying to get out of first gear. With the coast from North Carolina to Massachusetts threatened by furious winds and a potentially devastating storm surge, businesses closed, refiners shut down operations and insurers girded for a leap in damage claims. The New York Stock Exchange and the Nasdaq market closed completely on Monday, and the NYSE said it would not reopen until Wednesday, "conditions permitting." It was the first full trading shutdown since the 9/11 attacks closed US equity markets for four days in 2001, and the first full NYSE shutdown due to weather since September 1985, when it closed for a day for Hurricane Gloria. Disaster estimator Eqecat forecast that Hurricane Sandy could cause up to $20 billion in damages, only half of them insured, as it strikes land around New Jersey and collides with another front. "Sandy is a large storm, impacting 20 percent of the US population," Tom Larsen, senior vice president, said in a statement. That could hit an economy that has been largely struggling to gather pace, with economic growth at just 2.0 percent in the third quarter and the government struggling to overcome an unemployment rate of 7.8 percent. The storm also comes as President Barack Obama battles a strong challenge from Republican Mitt Romney, with the November 6 election offering voters a choice between the very different economic plans mapped out by the two. Four major economic centers -- New York, Philadelphia, Baltimore and Washington -- were largely closed down, with mass transit and flights curtailed or halted completely, businesses shuttered and many office employees forced to work from home. Banks like Bank of America and Goldman Sachs -- located in low-lying areas of Manhattan that were ordered evacuated in the face of a flooding threat -- shut their doors and transferred crucial operations to other offices. Many companies expected to announce quarterly earnings put off the release, including Pfizer, McGraw-Hill and Thomson-Reuters. There were widespread warnings that power would be cut to many homes and businesses, meaning that even after the mega-storm passes on Wednesday, many people would possibly still be unable to go back to work. Hurricane Sandy was packing maximum sustained winds of nearly 90 miles (150 kilometers) per hour Monday as it headed for the US East Coast, where it was to collide with another huge front. Storm surges were already causing flooding along the coast, with more flooding expected. Worries that fuel could be in short supply because of the shutdown of several oil refineries along the coast were downplayed, mainly because consumption was also sharply lower as drivers stayed home. "Gas availability could be affected more from the threats of flooding," said Stephen Rajczyk of the northern New Jersey branch of the motorists' organization AAA. But, he added, "Prices should not be impacted by this due to less driving, businesses and schools closed, less economic activity in general." Some played down the broader impact of the storm on the economy, saying that building, trading and shopping would resume in a burst after the storm. "Wealth destruction is bad, and Hurricane Sandy could destroy billions in national wealth," said Jason Schenker of Prestige Economics. "Nevertheless, while hurricanes and other natural disasters are extremely negative for wealth, they are usually positive for growth."