Stock markets catch cold as Coronavirus fears spread

Markets in Europe fell drastically on Friday morning, with London’s FTSE 100 index falling more than 3%.

Asian markets were subject to larger drops, while in the USA, the Dow Jones reported its largest daily points drop on Thursday.

Investors are becoming increasingly concerned that the impact of the Coronavirus could initiate a global recession.

The recent news of more coronavirus cases, notably in Italy, have increased concerns around the world of a much larger economic impact than previously anticipated.

In an interview with Sky News, Bank of England governor Mark Carney warned that the coronavirus outbreak could lead to a downgrade of the UK’s economic growth prospects.

A panoply of other companies have issued profit warnings and highlighted concerns of the impact of the virus on their balance sheets. Earlier this week, whisky giant Diageo warned that the closure of bars and restaurants in Greater China, the postponement of events, reduction in conferences and a decrease in tourism may have an impact on its finances.

Large businesses such as Apple and Microsoft also warned that their businesses will be affected by the effects of the virus.

Many key global market indexes, including the FTSE 100 and the Dow Jones, have fallen 10% from recent highs. A drop of that magnitude is generally referred to as a correction, the BBC reports.

All the main European share indexes saw large drops as trading initiated on Friday, with Germany’s Dax index opening down 3.6% and France’s Cac 40 index falling 3.1%. In Asia, Japan’s Nikkei 225 index fell 3.7%, meaning that has decreased more than 9% for this week. China’s Shanghai Composite index also fell 3.7% on Friday.