US, WASHINGTON (ORDO NEWS) — The main European stock markets were down sharply on Monday morning, penalized by fears linked to the spread of the coronavirus and by the lack of consensus in the United States Senate on a plan to revive the American economy.
In Paris, the CAC 40 index lost 3.94% to 3.889.32 points around 09.10 GMT. In Frankfurt, the Dax yields 4.05% and in London, the FTSE abandons 3.66%.
The EuroStoxx 50 index for the euro zone fell by 3.63%, the FTSEurofirst 300 by 4.39% and the Stoxx 600 by 4.15%.
The rebound recorded at the end of last week thanks to the strong action of the central banks therefore seems too fragile to continue in the face of the continuing worsening of the balance sheet of the epidemic, which affects more than 337,000 people around the world and has already caused 14,651 deaths according to data compiled Monday morning by Reuters.
In addition to the health balance, the negative trend is fueled by the blocking by the American democratic senators of the bill which would have injected more than 1.000 billion dollars into the economy within the framework of programs intended to help the companies affected by coronavirus and employees who have lost their jobs.
A new vote on this text must be organized this Monday unless an agreement is reached before 1:45 p.m. GMT.
“The worsening coronavirus epidemic is severely damaging the global economy. We expect global growth to approach the lows reached during the 2008 financial crisis and US growth to its lowest level since 74, “said a Morgan Stanley analyst (NYSE: MS ).
James Bullard, chairman of the Federal Reserve in St. Louis, warned on Sunday that the unemployment rate in the United States could reach 30%, a higher figure than during the Great Depression and three times the level reached during the 2008-2009 recession.
Figures for weekly jobless claims in the United States will be released on Thursday and economists expect a jump to 750,000 in the week to March 21 from 281,000 in the previous week.
In Germany, the Ifo Institute has estimated that the coronavirus crisis could cost the German economy between 255 and 729 billion euros this year.
As is often the case with such a market downturn, no European sector is spared from risk aversion. The most affected again is that of air transport and tourism, which lost 7.25%.
The Stoxx commodities index fell by 5.96%, that of the sector and gas by 3.37% and that of the automobile by 4.71%.
Airbus (PA: AIR ) plunges 7.21%, one of the biggest decreases in the ACC, after having suspended its annual forecasts, withdrawn its dividend proposal and signed a new credit facility,
The aircraft manufacturer is not the only one to have suspended its forecasts of annual results .: this is also the case this Monday for Schneider Electric (PA: SCHN ), Saint-Gobain (PA: SGOB ) or TF1 ( PA: TFFP ), which lost between 2.70% and 7.86%.
A small-cap stands out in Paris, Novacyt (PA: ALNOV ), which soars 37% after the green light from the American regulator to use its coronavirus screening test in the United States.
Rising in initial trade, the New York Stock Exchange finally fell Friday at the end of its worst week since October 2008 while containment measures are spreading in the United States.
The Dow Jones index lost 4.55% on the session at 19,173.98. The S & P-500 lost 4.34% to 2,304.92 and the Nasdaq Composite fell 3.79% to 6,879.52 points.
Over the week, the Dow plunged 17.30%, the S & P-500 by 15% and the Nasdaq by 12.64%.
Futures on the American indices are currently signaling an opening down from 2.5% to 3.8% for the three benchmarks.
Stock exchanges in mainland China lost more than 3%. The fall is heavier in Seoul where the Kospi dropped 5.4% and the Hong Kong Stock Exchange fell 4.85%.
The MSCI index combining stocks from Asia and the Pacific (excluding Japan) lost 5%.
Against the trend, the Japanese Nikkei finished up 2%. Investors, who feared a cancellation of the Tokyo Olympic Games, were relieved that the International Olympic Committee (IOC) is only considering a postponement for the time being.
The renewed risk aversion is causing a further drop in US bond yields. In trade in Asia, that of ten-year securities dropped 11 basis points to 0.8293%, after a session low of 0.78%.
In Europe, while the yield on the German 10-year Bund fell two basis points to -0.364%, its Italian equivalent gained four to 1.67%.
The fall in US bond yields weighs on the dollar: the index measuring its variations against a basket of international currencies yields 0.4%.
The euro is almost stable at 1.0690 dollars.
Crude oil prices are down due to fears for world demand: a barrel of Brent crude falls 5.52% to around 25.5 dollars while that of light American crude loses more than 1% to 22.34 dollars.
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The article is written and prepared by our foreign editors from different countries around the world – material edited and published by Ordo News staff in our US newsroom press.