The stocks plummeted down on Friday as the coronavirus outbreak caused more disruption in the business sectors. The markets ended the last session in the red. European shares lowered sharply. The travel stocks suffered severely. Investors are concerned as they can’t calculate the definite date when the outbreaks will cease.
The outbreaks have already triggered corporate defaults, panic buying of daily necessities, and office evacuations. The governments and companies in Italy, the United States, Britain, and France, are struggling to deal with the rise of virus infections.
According to Mark Haefele, chief investment officer at UBS Global Wealth Management, the interplay of stimulus measures and virus containment fears means that in the near term, volatility will probably persist.
So far, the U.S. braved the economic slowdown. Its financial data showed good results, but concerns about the epidemic overshadow the signs of a strong labor market.
However, other stocks haven’t fared so well. Britain’s FTSE 100 dropped down by 1.8%, and France’s CAC 40 slid by 2.4%. The pan-European STOXX 600 index also fell by 2.4% along with Germany’s DAX. The MSCI All-Country World Index plummeted down by 0.72%.
The Reserve Bank of Australia and the Bank of Canada slashed rates to control the damage. The Fed also made an emergency interest rate cut of 50 basis points last week. Investors are expecting that other major central banks will follow suit soon.
Global stocks indexes were up 1.7% last week, thanks to the various stimulus from policymakers to fight the economic drawback of the virus. But they showed their worst weekly performance since the 2008′ financial crisis.
What about the stocks in Asia?
Chinese futures dropped by 1.22% as the country take the brunt of the coronavirus outbreak. The virus struck stocks in Hong Kong. They slid by 2.12%.
Japan’s Nikkei stock index fell by 2.94%, with Australian shares declining by 2.44%. MSCI’s broadest index of Asia-Pacific shares outside Japan also dropped down by 2.1%.
