Not long enough after the 2008 global financial crisis, the world was rocked anew as the stock markets in different countries have plummeted due to the growing fears caused by the coronavirus pandemic.
The huge hit was felt from March 9 to 13 as global stocks fell more than 11.5%, marking the worst weekly finish since the great recession in 2008. The plunge was reportedly intensified by the Russia-Saudi Arabia oil price war that was launched March 8 and has triggered a major drop in crude prices.
In general, financial markets across the globe have been upset by the virus outbreak because it has shut down service and manufacturing operations as well as curbed local and international travels.
And now that the COVID-19 death toll has soared over 6,500 and leaves beyond 169,000 in 148 countries and regions infected, economic policymakers and investors brace for the possible worse crash.
The US and Asian stock markets both fell on Monday after the Federal Reserve trimmed its key interest rates to almost zero as part of its emergency measures to deal with the economic slowdown amid the outbreak.
“Despite whipping out the big guns, the Fed’s action is falling short of being the decisive backstop for markets,” said Vishnu Varathan of Mizuho Bank according to ABC News.
U.S. Treasuries yields fell sharply from 0.28 percentage points to less than 0.7 % in early trading. The American crude prices and the Wall Street’s futures for the benchmark S&P 500 index have sharply fallen.
Yahoo Finance reported that Dow and Nasdaq futures were down 4.6 and 4.5%, respectively.
In Asia, Hong Kong’s Hang Seng index was down 2% while the Shanghai market dropped at 0.6%. South Korean shares lost 1.6% and Japan’s Nikkei closed flat.
Singapore’s bourse fell more than 3%, India’s Nifty 50 plunged 5.72% and the Philippine Stock Exchange index was down by 7.14%.
Meanwhile, Australia’s benchmark was down 7.5%, leading major markets in the region.
European stocks also tumbled following Italy’s lockdown and Spain’s declaration of a state of emergency over the outbreak.
Reports claimed that Italian stocks closed up 7%.
Oil and gas stocks. SXEP fell almost 30% while Brent crude lost $1.01 to $32.84 per barrel in London.
Some observers said that China’s slow return to operations could help a number of countries’ stocks bounce back, but other experts contended that the spread of the coronavirus across continents poses a continued cause for economic anxiety.