Coronavirus has cost global stock markets $16 trillion in less than a month
The novel coronavirus continued to weigh heavily on financial markets Friday, though stocks were mostly higher in Europe after wild swings in Asia. Global stock market losses climbed past $16 trillion since a high on February 19 on fears that the outbreak could lead to a worldwide recession.
Equities rose Friday in Paris, London and Germany but lost 6.1% in Japan. The Nikkei average had plunged as much as 9.5% earlier in the session, echoing Thursday's brutal 10% collapse on U.S. markets, the largest single day decline since 1987's Black Monday.
Futures markets were also hinting that the bleeding might stop, at least for now. After initially indicating the Dow Jones Industrial Average would drop another 500 points, or about 2%, Friday morning and pointing to a similar drop in the S&P 500, Dow futures were up 745 points, or about 3.5% as of 5:23 a.m. Eastern time and S&P futures were 3.6% higher.
A pessimistic Barclays note to clients Thursday night had its economists cutting their GDP estimates for U.S. growth for 2020, saying a recession could start as early as April. They predicted coronavirus "hotspots," now largely in California, Massachusetts, New York and Washington, could spread to states that represent as much as 60% of the U.S. GDP.
Goldman Sachs in a note to clients said it expects the Federal Reserve to cut interest rates a full percentage point when its policy committee meets next week.