As the coronavirus is wreaking havoc in the global market, share markets are experiencing an unprecedented decline. Global stock markets have fallen sharply as investors continue to worry about the broader economic effects of the coronavirus and the global is witnessing steep falls in recent days amid the outbreak. London’s FTSE 100 share index fell more than 3 percent and other European markets are in the same boat. Within the first few minutes of trading Monday morning, the S&P 500 dropped as much as 7.4 percent and trading was temporarily suspended to protect investors from further losses. The sharp drop is likely to continue for a couple of weeks, if not more as how deep or lasting the economic impact will depend on the coronavirus’s spread, and how governments manage the outbreak. The Dow Jones was also briefly down more than 2,000 points before readjusting to the most recent loss of 1,865 points, or 7.2 percent and the monthly report reflects data collected before the outbreak intensified. The governments have issued complete lockdown and the travel industry has taken a major hit while work, school, and shopping has been disrupted in many countries.
Amid this outbreak which is intensifying with each day, many are left wondering what can be expected from the market as the virus continues to spread. The question that arises from this crisis is, is this a temporary fall or should we all be battening down for further market downturns? As the virus continues to escalate unsettling supply chains, dipping sales of some products, throwing travel into chaos, freaking out the stock markets, and intensifying fears of a global recession. Earlier on Friday, markets in Asia had seen big falls, with Japan's Nikkei share index dropping by 2.7% but since the world lacks information about this virus it is highly unlikely that we looking at economic fallout for countries. Everything that is happening in the world is making an impact on the markets, straining economies and its development.
A survey has concluded that 45 percent of respondents were worried about their ability to work amid the outbreak while 45 percent were worried about incurring losses to investment and retirement savings whereas, 50 percent mentioned that they are not financially prepared to deal with the outbreak. The global GDP growth has begun to slow in response to the outbreak and supply chains around the globe have begun faltering. But it’s clear from how wildly markets are reacting, and from the responses of governments that the world is bracing for a potential coronavirus-linked downturn as travelers are restricted from travels while shares in travel companies saw some of the steepest falls.
Banks are also witnessing the impact of the outbreak because investors have forecasted that the banks would slash the interest rates so companies consumers can borrow at cheaper rates to keep economy floating.