This article is from the source 'guardian' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.
You can find the current article at its original source at https://www.theguardian.com/business/live/2020/mar/16/recession-markets-tumble-fed-emergency-rate-cut-coronavirus-ftse-dow-iag-flutter-business-live
The article has changed 16 times. There is an RSS feed of changes available.
| Version 1 | Version 2 |
|---|---|
| Wall Street plunges as Covid-19 global recession fears haunt markets - business live | Wall Street plunges as Covid-19 global recession fears haunt markets - business live |
| (32 minutes later) | |
| Rolling coverage of the latest economic and financial news, as shares fall sharply again in Asia and Europe | Rolling coverage of the latest economic and financial news, as shares fall sharply again in Asia and Europe |
| In another example of how Covid-19 is shaking Europe, the EU is now proposing suspending all non-essential travel for 30 days. | |
| Ursula von der Leyen, the president of the EU commission, tweeted the news. | |
| Our main coronavirus liveblog has more details. | |
| Just in: bookmaker William Hill has suspended its dividend payments to shareholders, following the mass cancellation of sporting events. | |
| The conavirus crisis has ripped through the sporting world, stripping out most opportunities for punters to wager their money (and often lose it, in my personal experience), | |
| With professional football in England on hold, along with leagues in Germany and France -- and even Euro 2020 under threat -- William Hill sees a major impact on its revenues and profits. | |
| It says: | |
| In a surprise development, a few shares are actually rising on the London exchange. | In a surprise development, a few shares are actually rising on the London exchange. |
| These plucky stocks include steel and mining group Evraz (+6%), supermarket chain Sainsbury (+2.7%), and software firm Sage Group (+2%). | These plucky stocks include steel and mining group Evraz (+6%), supermarket chain Sainsbury (+2.7%), and software firm Sage Group (+2%). |
| They’re hugely outnumbered by the fallers, of course - with airlines IAG and easyJet still down at least 20%, and the housebuilders shedding around 15%. | They’re hugely outnumbered by the fallers, of course - with airlines IAG and easyJet still down at least 20%, and the housebuilders shedding around 15%. |
| But it’s helping to pull the FTSE 100 up from the abyss, to around 5,095 points -- which would still be an eight-year closing low. | But it’s helping to pull the FTSE 100 up from the abyss, to around 5,095 points -- which would still be an eight-year closing low. |
| European finance ministers are facing calls to agree an EU-wide stimulus package to help European economies cope with the fallout of the coronavirus crisis, my colleague Jennifer Rankin reports from Brussels. | European finance ministers are facing calls to agree an EU-wide stimulus package to help European economies cope with the fallout of the coronavirus crisis, my colleague Jennifer Rankin reports from Brussels. |
| The EU’s 27 finance ministers are due to start talks via video link imminently, after the usual monthly eurozone meeting was expanded to include the eight EU non-euro countries. Face-to-face talks in Brussels were moved online, after increasing numbers of countries introduced policies to discourage travel. | The EU’s 27 finance ministers are due to start talks via video link imminently, after the usual monthly eurozone meeting was expanded to include the eight EU non-euro countries. Face-to-face talks in Brussels were moved online, after increasing numbers of countries introduced policies to discourage travel. |
| Mário Centeno, the Portuguese minister chairing the meeting, said containing the virus was “bringing our economies to warlike times”. | Mário Centeno, the Portuguese minister chairing the meeting, said containing the virus was “bringing our economies to warlike times”. |
| In a video message ahead of the meeting, he promised the group would agree liquidity support to firms, especially small and medium-sized enterprises, as well as full flexibility on EU fiscal and state aid rules to allow governments to help ailing firms and out-of-work employees. | In a video message ahead of the meeting, he promised the group would agree liquidity support to firms, especially small and medium-sized enterprises, as well as full flexibility on EU fiscal and state aid rules to allow governments to help ailing firms and out-of-work employees. |
| These measures were outlined by the European commission on Friday and are expected to be backed by ministers without any difficulty. | These measures were outlined by the European commission on Friday and are expected to be backed by ministers without any difficulty. |
| Centeno said: | Centeno said: |
| But the ministers are facing calls to go much further, such as developing an EU-wide stimulus package and making available an EU credit line to indebted countries. | But the ministers are facing calls to go much further, such as developing an EU-wide stimulus package and making available an EU credit line to indebted countries. |
| In an open letter, Socialist and Democrat MEPs, the second-largest group in the European parliament, call for “a proper stimulus package agreed at the European level”, financed by the European Stability Mechanism, the eurozone bailout fund. | In an open letter, Socialist and Democrat MEPs, the second-largest group in the European parliament, call for “a proper stimulus package agreed at the European level”, financed by the European Stability Mechanism, the eurozone bailout fund. |
| Green MEPs have delivered a similar message, but put emphasis on accelerating the European Green Deal, a sweeping plan to transform Europe’s economy to drastically reduce emissions. | Green MEPs have delivered a similar message, but put emphasis on accelerating the European Green Deal, a sweeping plan to transform Europe’s economy to drastically reduce emissions. |
| They write: | They write: |
| Both groups want an EU-backed credit line for indebted countries, intended to prevent markets betting against countries such as Italy will be forced to borrow more to deal with the crisis. | Both groups want an EU-backed credit line for indebted countries, intended to prevent markets betting against countries such as Italy will be forced to borrow more to deal with the crisis. |
| But not everyone is convinced now is the time for a general stimulus package. | But not everyone is convinced now is the time for a general stimulus package. |
| Clemens Fuest, president of the ifo institut and adviser to the German government, told the Observer that encouraging social consumption makes “no sense” when people are being discouraged from going to bars and restaurants. | Clemens Fuest, president of the ifo institut and adviser to the German government, told the Observer that encouraging social consumption makes “no sense” when people are being discouraged from going to bars and restaurants. |
| He said eurozone ministers should issue “a general signal of solidarity” i.e a statement of support to indebted countries, rather than a precautionary credit line. | He said eurozone ministers should issue “a general signal of solidarity” i.e a statement of support to indebted countries, rather than a precautionary credit line. |
| The Dow Jones industrial average has now slumped to its lowest since spring 2017. | The Dow Jones industrial average has now slumped to its lowest since spring 2017. |
| Having almost hit 30,000 points in February, it has now shed roughly 30% of its value in the last month -- down to around 21,000. | Having almost hit 30,000 points in February, it has now shed roughly 30% of its value in the last month -- down to around 21,000. |
| This means that much of the gains racked up under Donald Trump (and boasted about by the president) have been wiped out by Covid-19: | This means that much of the gains racked up under Donald Trump (and boasted about by the president) have been wiped out by Covid-19: |
| The markets have completely lost faith in the idea that the global economy could bounce back from the shock of Covid-19. | The markets have completely lost faith in the idea that the global economy could bounce back from the shock of Covid-19. |
| Instead, they seem to be pricing in a slump - followed by stagnation. Or an L-shaped recovery, not a V-shaped one. | Instead, they seem to be pricing in a slump - followed by stagnation. Or an L-shaped recovery, not a V-shaped one. |
| Neil Mackinnon, global macro strategist at VTB Capital, explains: | Neil Mackinnon, global macro strategist at VTB Capital, explains: |
| The coronavirus has now reached the Basel headquarters of the Bank of International Settlements: | The coronavirus has now reached the Basel headquarters of the Bank of International Settlements: |
| Today’s Wall Street slump shows comprehensively that the US Federal Reserve has failed to calm the markets, with its surprise interest rate cut last night. | Today’s Wall Street slump shows comprehensively that the US Federal Reserve has failed to calm the markets, with its surprise interest rate cut last night. |
| The Fed had hoped to tackle the tensions in the markets by cutting rates to near zero, pledging to buy $700bn of assets, and easing banks’s reserve requirements. | The Fed had hoped to tackle the tensions in the markets by cutting rates to near zero, pledging to buy $700bn of assets, and easing banks’s reserve requirements. |
| Teaming up with the central banks fo the UK, Japan, Switzerland, Canada and the eurozone to make dollars more cheaply available was also meant to ease liquidity in the markets. | Teaming up with the central banks fo the UK, Japan, Switzerland, Canada and the eurozone to make dollars more cheaply available was also meant to ease liquidity in the markets. |
| But Wall Street, like other international markets, is unimpressed. | But Wall Street, like other international markets, is unimpressed. |
| Neil Wilson of Markets.com explains: | Neil Wilson of Markets.com explains: |
| Can world leaders stop the panic in the markets, and ward off a global downturn? | Can world leaders stop the panic in the markets, and ward off a global downturn? |
| We’ll find out later today, after they hold an emergency call -- or video summit -- to discuss the crisis. | We’ll find out later today, after they hold an emergency call -- or video summit -- to discuss the crisis. |
| The recent share plunges shows that the markets are screaming out for joint action to prop up the economy. Such a plan would need to save once-healthy firms now facing a cash flow crisis and help people who are laid off as demand slumps. | The recent share plunges shows that the markets are screaming out for joint action to prop up the economy. Such a plan would need to save once-healthy firms now facing a cash flow crisis and help people who are laid off as demand slumps. |
| It’s a broad-based rout on Wall Street today. | It’s a broad-based rout on Wall Street today. |
| Every stock on the Dow is in the red. | Every stock on the Dow is in the red. |
| Aircraft maker Boeing has slumped by a fifth - demand for its jets will be badly hit as airlines suspend flights and ground their jets. | Aircraft maker Boeing has slumped by a fifth - demand for its jets will be badly hit as airlines suspend flights and ground their jets. |
| Credit card operator American Express is off 16.5%, on the prospect of a slump in US consumer spending. | Credit card operator American Express is off 16.5%, on the prospect of a slump in US consumer spending. |
| Newsflash: Trading has resumed on Wall Street, and stocks are rocketing lower: | Newsflash: Trading has resumed on Wall Street, and stocks are rocketing lower: |
| The Dow Jones has slumped by 2,798 points - or 12.07% - to 20,387. | The Dow Jones has slumped by 2,798 points - or 12.07% - to 20,387. |
| The broader S&P Index tumbled by over 10.5% - losing 286 points to 2,425. | The broader S&P Index tumbled by over 10.5% - losing 286 points to 2,425. |
| This more than wipes out Friday’s late rally -- which was triggered when Donald Trump announced he was declaring a state of emergency over the coronavirus. | This more than wipes out Friday’s late rally -- which was triggered when Donald Trump announced he was declaring a state of emergency over the coronavirus. |