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Stock markets tumble as ECB launches new stimulus - business live Wall Street plunges again as Trump's EU travel ban sends shares crashing - business live
(32 minutes later)
Rolling coverage of the latest economic and financial news, as world stock markets plunge againRolling coverage of the latest economic and financial news, as world stock markets plunge again
It’s another horrific day in the markets, turning into the bleakest sell-off we’ve seen since this crisis began.
The FTSE 100 index is on track for its worst one-day fall since 1987. Worse than Monday’s plunge. Worse than any single day in 2008 after Lehman Brothers failed.
Right now, here’s the situation:
Dow: down 2,015 points or 8.5% at 21,537
FTSE 100: down 540 points or 9.1% at 5322
Trading has resumed on Wall Street, and the Dow has promptly plunged by 2,000 points!
That takes the index down to a new one-year low, and shows just how serious this market crash is turning into.
Investors are becoming petrified of a worldwide recession, a coronavirus pandemic, widespread losses that leave companies unable to repay debts.
And Donald Trump’s statement last night is clearly failing to provide reassurance or support.
News that trading has been suspended on Wall Street has triggered a monster selloff in Europe.
The FTSE 100 has plunged 9%, shedding 546 points to just 5,330.37 -- levels not seen since 2012.
European stock markets have crated by 10% -- which would be the worse day ever for the Stoxx 600 index of EU companies.
NEWSFLASH: Trading has been briefly suspended on the US stock exchange, for the second time this week.
Automatic circuit breakers kicked in shortly after the open, at 9.30am New York (1.30pm UK), when the S&P 500 index plunged 7%.
The Dow has also plunged 7%, losing 1,696 points to 21,856 in opening trades. Investors are clearly more worried than ever about a global recession and a Covid-19 pandemic, following president Trump’s shock EU travel ban announced late last night.
That activates a 15-minute suspension (as happened on Monday).
The coronavirus crisis has forced the Princess Cruises line to suspend global operations for the next two months.The coronavirus crisis has forced the Princess Cruises line to suspend global operations for the next two months.
Princess’s 18 cruise ships will be off duty for the next 60 days, a big blow to owner Carnival (whose shares were down 20% earlier)Princess’s 18 cruise ships will be off duty for the next 60 days, a big blow to owner Carnival (whose shares were down 20% earlier)
Two Princess ships have been at the heart of the crisis.Two Princess ships have been at the heart of the crisis.
The Diamond Princess was quarantined off the coast of Japan -- 700 passengers became infected, and 6 died. The Grand Princess was denied entry to San Francisco Bay last Wednesday en route back from Hawaii as authorities learned some passengers and crew had developed flu-like symptoms. It was finally allowed to dock on Monday:The Diamond Princess was quarantined off the coast of Japan -- 700 passengers became infected, and 6 died. The Grand Princess was denied entry to San Francisco Bay last Wednesday en route back from Hawaii as authorities learned some passengers and crew had developed flu-like symptoms. It was finally allowed to dock on Monday:
The top faller on the FTSE 250 is Finablr, which runs Travelex. Shares are down 66% (!) after it warned it might struggle to access cash needed to manage its business as well as negotiate longer term financing.The top faller on the FTSE 250 is Finablr, which runs Travelex. Shares are down 66% (!) after it warned it might struggle to access cash needed to manage its business as well as negotiate longer term financing.
Restaurant Group, which runs Frankie & Benny’s, Garfunkel’s and Wagamama, are down 23%. Clearly it would suffer from mass self-isolation in the coming weeks...Restaurant Group, which runs Frankie & Benny’s, Garfunkel’s and Wagamama, are down 23%. Clearly it would suffer from mass self-isolation in the coming weeks...
...as would airport food operator SSP, who are down 19%....as would airport food operator SSP, who are down 19%.
Shares in UK train and bus operators are slumping today, after Go-Ahead warned the coronavirus would hurt profits.Shares in UK train and bus operators are slumping today, after Go-Ahead warned the coronavirus would hurt profits.
National Express are down 18%, First Group has lost 17%, Stagecoach are off 12%, and Trainline are down 11%. Their revenues would all suffer if fewer people travel into work (as seems imminent).National Express are down 18%, First Group has lost 17%, Stagecoach are off 12%, and Trainline are down 11%. Their revenues would all suffer if fewer people travel into work (as seems imminent).
Go-Ahead itself is down 30%, making it one of the big fallers on the FTSE 250.Go-Ahead itself is down 30%, making it one of the big fallers on the FTSE 250.
Back in the UK, Travel insurers Aviva, InsureandGo, and the Post Office have followed LV= and have withdrawn cove for future coronavirus claims, or stopped selling policies,. Back in the UK, Travel insurers Aviva, InsureandGo, and the Post Office have followed LV= and have withdrawn cover for future coronavirus claims, or stopped selling policies.
On Wednesday night LV= shocked the travel industry when it announced that it would stop selling all travel insurance policies with immediate effect, due to the coronavirus outbreak.On Wednesday night LV= shocked the travel industry when it announced that it would stop selling all travel insurance policies with immediate effect, due to the coronavirus outbreak.
The move appears to have been prompted by the World Health Organisation declaration of a pandemic, on Wednesday afternoon.The move appears to have been prompted by the World Health Organisation declaration of a pandemic, on Wednesday afternoon.
Industry regulator the European Banking Authority is delaying its EU-wide stress test by a year so that banks can focus on the challenges posed by the coronavirus outbreak.Industry regulator the European Banking Authority is delaying its EU-wide stress test by a year so that banks can focus on the challenges posed by the coronavirus outbreak.
Instead, the EBA said it would launch a transparency exercise to determine how much risk they hold on their balance sheets.Instead, the EBA said it would launch a transparency exercise to determine how much risk they hold on their balance sheets.
The EBA said.The EBA said.
It also urged national regulators to take advantage of existing rules that allow for some flexibility around the kind of capital that banks have to hold to cushion against potential downturns and risks.It also urged national regulators to take advantage of existing rules that allow for some flexibility around the kind of capital that banks have to hold to cushion against potential downturns and risks.
The announcement comes just a week after EBA banned all external meetings at its Paris headquarters until 20 April to try tackle the spread of Covid-19.The announcement comes just a week after EBA banned all external meetings at its Paris headquarters until 20 April to try tackle the spread of Covid-19.
By resisting a rate cut today, the ECB has left its benchmark rate at 0%.By resisting a rate cut today, the ECB has left its benchmark rate at 0%.
It will continue to impose a negative rate of 0.5% on commercial bank deposits left at the ECB (to encourage lending).It will continue to impose a negative rate of 0.5% on commercial bank deposits left at the ECB (to encourage lending).
And that means that today’s new cheap loans to banks will be priced at -0.75%. In other worse, the ECB will be paying commercial banks to borrow - as long as they actually pass this money onto the real econmy.And that means that today’s new cheap loans to banks will be priced at -0.75%. In other worse, the ECB will be paying commercial banks to borrow - as long as they actually pass this money onto the real econmy.
European stock markets are plunging deeper into the red following the ECB’s announcement.European stock markets are plunging deeper into the red following the ECB’s announcement.
The FTSE 100 is now down 420 points, or 7.1%, at 5456 -- which would be its lowest close since 2012.The FTSE 100 is now down 420 points, or 7.1%, at 5456 -- which would be its lowest close since 2012.
The German DAX is also sliding:The German DAX is also sliding:
And....the eurozone bank index has hit a record low.And....the eurozone bank index has hit a record low.
And also.... the gap between German and Italian government bonds has widened.And also.... the gap between German and Italian government bonds has widened.
That suggests there’s disappointment that the ECB hasn’t gone further today, either with a rate cut or some targeted help for Italy.That suggests there’s disappointment that the ECB hasn’t gone further today, either with a rate cut or some targeted help for Italy.
The European Central Bank is also relaxing the capital rules on banks, to help them through the crisis.The European Central Bank is also relaxing the capital rules on banks, to help them through the crisis.
It says:It says:
NEWSFLASH: The European Central Bank has announced new stimulus measure to support the eurozone economy through the coronavirus shock.NEWSFLASH: The European Central Bank has announced new stimulus measure to support the eurozone economy through the coronavirus shock.
It is launching new longer-term refinancing operations (LTROs), which will offer liquidity to the financial system, saying:It is launching new longer-term refinancing operations (LTROs), which will offer liquidity to the financial system, saying:
It is also offering new, very cheap loans for banks, to encourage lending:It is also offering new, very cheap loans for banks, to encourage lending:
Thirdly, it is boosting its quantitative easing (asset-purchase) scheme by €120bnThirdly, it is boosting its quantitative easing (asset-purchase) scheme by €120bn
BUT it has also left interest rates on hold at today’s meeting, resisting pressure to cut to new record lows.BUT it has also left interest rates on hold at today’s meeting, resisting pressure to cut to new record lows.
It’s just passed noon, and there’s no recovery in the City.It’s just passed noon, and there’s no recovery in the City.
The FTSE 100 is still being hammered, down 5.7% or 341 points at 5534. Every share is still down.The FTSE 100 is still being hammered, down 5.7% or 341 points at 5534. Every share is still down.
Holiday firms Carnival and TUI are among the worst of a very bad lot, down 14% each.Holiday firms Carnival and TUI are among the worst of a very bad lot, down 14% each.
Thameslink and Southeastern rail operator Go-Ahead is in discussions with the Government on relaxing the rules around timetable changes to cope with the conoravirus pandemic, reports the Press AssociationThameslink and Southeastern rail operator Go-Ahead is in discussions with the Government on relaxing the rules around timetable changes to cope with the conoravirus pandemic, reports the Press Association
Chief executive David Brown explained he is hoping to be allowed to make changes faster than the current 70-day notice period.Chief executive David Brown explained he is hoping to be allowed to make changes faster than the current 70-day notice period.
Food delivery group Deliveroo has introduced a “no contact drop-off service” as concern grows about the coronavirus pandemic in the UK.Food delivery group Deliveroo has introduced a “no contact drop-off service” as concern grows about the coronavirus pandemic in the UK.
The app-based food delivery company told customers they will be able to request in the app that their food is left on the doorstep, thus “removing the need for direct contact for both parties.”The app-based food delivery company told customers they will be able to request in the app that their food is left on the doorstep, thus “removing the need for direct contact for both parties.”
A spokesperson says this will keep customers, riders and restaurants safer.A spokesperson says this will keep customers, riders and restaurants safer.
The coronavirus crisis has forced housebuilder Berkeley Group to suspend a £455m payout to shareholders, a mixture of dividends and share buybacks, until there is greater clarity on the economic impact of the pandemic.The coronavirus crisis has forced housebuilder Berkeley Group to suspend a £455m payout to shareholders, a mixture of dividends and share buybacks, until there is greater clarity on the economic impact of the pandemic.
It added that there had been “no noticeable impact” on its business so far.It added that there had been “no noticeable impact” on its business so far.