Global Markets Fail Before Virus Spread, Cases Grow

Global Markets Fail Before Virus Spread, Cases Grow

Global stock exchanges dived Friday as disruptions to business from the spreading coronavirus worsened, stoking fears of a prolonged economic downturn.

Global Markets Fail Before Virus Spread, Cases Grow

European stocks opened sharply lower, with travel shares bearing the brunt. The Pan-European index was down 2.4%.

Germany’s DAX dipped 2.4%, Britain’s FTSE 100 plunged 1.8% and France’s CAC 40 dived 2.4%.

The MSCI All-Country World Index, which tracks shares across 47 nations, was down 0.72%.

After flagging their worst weekly performance since the 2008 financial crisis, global shares as measured by the index are up 1.7% this week, as sentiment recovered on the back of stimulus from policymakers to combat the financial fallout of the virus.

The U.S. Federal Reserve made an emergency rate of interest reduction of 50 basis points earlier this week. The Bank of Canada and the Reserve Bank of Australia cut rates, with investors expecting other major central banks to comply with suit.

Delegates and corporations in Britain, France, Italy and the U.S. are struggling to deal with a gradual rise in virus infections, which have, in some cases, prompted corporate defaults, office evacuations, and panic buying of everyday necessities.

The outbreak spread throughout the US on Thursday, surfacing in no less than four new states.

Yields on U.S. Treasuries fell to a file low, and Treasury futures jumped as investors elevated bets that the Fed will comply with this week’s surprise rate reduction with further easing.

The yield on benchmark 10-year Treasury notes plunged to a record low of 0.7650% Friday.

Minneapolis Federal Reserve Prez Neel Kashkari stated Thursday the Fed might cut rates further if necessary.

Leave a Reply

Your email address will not be published. Required fields are marked *