Global equity markets roil as fear of Coronavirus spreads
The largest fall in Chinese stocks in eight months caused global equity markets to roil as global concerns heighten on the coronavirus outbreak in China.
Millions of Chinese prepare for the Lunar New Year to begin on Saturday, the peak travel season, increasing the disease’s potential to spread. Wuhan and Hunggang cities, with a total population of 18 million, were on lockdown to prevent the outbreak from spreading further. The World Health Organization called the measure “unprecedented.”
European stocks fell following the drop in Asian stocks. The pan-European STOXX 600 index fell 0.71%.
However, news of Gilead Sciences evaluating its experimental drug on Ebola to be a potential treatment to the virus caused a short recovery in US stocks and major benchmarks to mix.
The Dow Jones Industrial Average was down by 0.09%, or 26.45, at 29,159.82. S&P 500 increased 0.11%, or 3.75, at 3,325.5. Nasdaq Composite gained 0.2%, or 18.71, at 9,402.48.
Gold and US Treasuries subsequently gained as investors turn to safer assets. Gold reversed in Europe due to wide decline in metal markets. Copper marked a six-week low while nickel fell by 2%.
600 cases were confirmed in the virus outbreak in China with a death toll rising to 17.
Yuan marked a two-week low, nearly its worst week since August. Yen gained 0.2% on its third day of consecutive gain while the dollar remained flat.
Euro was at a six-week low and German bond yields sank to its lowest in two weeks.
US crude CLcv1 dropped 1.2% to $55.58 and Brent LCOcv1 slipped 1.2% to $62.03.