Global markets dropped to record lows after China reported few virus cases but new infections around the world forced investors to sell heavily in expectation of a global recession.
Past few weeks have been tense for global equities since the death toll from Covid 19 infections rose above the mortality rate of SARS epidemic of 2002. The reported numbers crossed outbreaks that occurred in Hong Kong, China and Singapore in comparison to SARS as well.
Globally, metals companies are negatively impacted by lower prices, while stocks of drugmakers are also facing the heat from the uncertainty of the outbreak.
World Health Organization officials said the COVID-19 virus could become a pandemic as the outbreak spreads to major developed economies and warned that failure to prepare for coronavirus now 'could be a fatal mistake'.
The viral outbreak that originated in China has now spread to six of the world's seven continents infecting more than 80,000 people. While the majority of cases and deaths remain centred in China, the virus has been reported for the first time in South America, making every other continent except Antarctica now infected by its outbreak. About 10 countries have reported their first virus cases over the past 24 hours, including Nigeria, the biggest economy in Africa.
Death toll in China has crossed 2,700 though new cases in the country are falling. The country reported 327 new cases on Friday, the lowest since January 23. In Italy, 320 have been infected, while number stands at 139 cases in Iran, 22 cases in Australia, 59 in America. Algeria and Egypt have reported first cases each today.
Wall Street logged its biggest one-day drop in nine years on coronavirus fears. The Dow Jones Industrial Average lost 1,190.95 points, its largest one-day point drop in history, bringing its loss for the week to 3,225.77 points, or 11.1%. The benchmark S&P 500 index was down more than 4% on Thursday.
China, Japan and South Korea all posted heavy losses. Japan's Nikkei gave up 3.3% on rising fears of Olympics cancellation due to the coronavirus, while South Korean shares shed 2.1%. Australian shares also dropped 2.8% to a six-month low.
Commenting on the market scenario today, Ajit Mishra, VP Research, Religare Broking said," The Indian markets tracked the rout in global indices and crashed as coronavirus' repercussions on the global economy continue to deepen. There are concerns that the outbreak is spreading to the world's largest economy - the USA as well as certain parts of Europe and that will adversely impact the global supply chains big time, thereby affecting economic growth of most of the nations."