European stock markets dive more than 4pc at open

The German share price index DAX graph is pictured at the stock exchange in Frankfurt, Germany, July 5, 2019. — Reuters pic
The German share price index DAX graph is pictured at the stock exchange in Frankfurt, Germany, July 5, 2019. — Reuters pic

LONDON, March 23 — European stocks dived more than four per cent in opening deals today as the coronavirus death toll continued to soar and US lawmakers failed to agree a trillion-dollar emergency package.

London’s benchmark FTSE 100 index of major blue-chip companies tumbled 4.8 per cent to 4,943.51 points, Frankfurt’s DAX shed 4.6 per cent to 8,521.94 and the Paris CAC 40 sank 4.4 per cent to 3,870.06, compared with Friday’s closing levels.

Asian equities were also hammered despite vast economic stimulus efforts worldwide, with investors spooked once more by the relentless Covid-19 pandemic.

“Markets are again showing stress on fears that the economic damage will be worse than anticipated and that the response by governments and central banks will not be enough to prevent a mammoth recession,” said analyst Neil Wilson at trading site Markets.com.

“James Bullard, President of the St Louis Fed, said US unemployment could reach 30 per cent in the second quarter due to coronavirus shutdowns, while he warned GDP could decline by 50 per cent. This would be an unprecedented event.”

The global death toll from the virus has surged past 14,400, with nearly a billion people confined and non-essential businesses shut in dozens of countries and growing fears about a recession.

“Countries across the globe (are adopting) increasingly stricter measures to stop the spread of coronavirus,” added City Index analyst Fiona Cincotta. 

“These very measures are threatening to overwhelm central banks’ efforts to cushion the economic fallout from coronavirus, increasing the prospect of a deep global recession.” — AFP

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