Italy’s coronavirus epidemic pounds economy as $1 TRILLION is wiped off world stock markets

Italy’s coronavirus epidemic pounds economy as $1 TRILLION is wiped off the value of world stock markets over outbreak fears

  • Infection fears from investors shaved 5.4 per cent off the Milan stock exchange 
  • Financial and industrial heartlands of Lombardy and Veneto are worst-affected
  • More than $1 trillion was wiped off the value of world’s stock markets over fears 

Italy’s coronavirus epidemic has pounded the country’s economy, which slumped after seven people died and 229 fell ill.

It came as more than a $1 trillion was wiped off the value of the world’s stock markets over fears about the virus outbreak.

Infection fears from investors shaved 5.4 per cent off the Milan stock exchange after the northern regions of Lombardy and Veneto – the industrial and financial heartlands – went into lockdown. 

Today’s market slide could just be the start of Italy’s woes, with Prime Minister Giuseppe Conte warning the economic hit could be ‘very strong’.  

He said: ‘The economic impact could be very strong. At this moment we can calculate that there will be a negative economic impact, we are not yet in a position to forecast what will happen.’  

Today’s market slide could just be the start of Italy’s woes, with Prime Minister Giuseppe Conte warning the economic hit could be ‘very strong’

Infection fears from investors shaved 5.4 per cent off the Milan stock exchange after the northern regions of Lombardy and Veneto - the industrial and financial heartlands - went into lockdown (pictured: an ambulance in a deserted Codogno, one the northern Italian towns placed under lockdown)

Infection fears from investors shaved 5.4 per cent off the Milan stock exchange after the northern regions of Lombardy and Veneto – the industrial and financial heartlands – went into lockdown (pictured: an ambulance in a deserted Codogno, one the northern Italian towns placed under lockdown)

After ministers announced top-flight football matches would be played in empty stadiums to stop fans spreading the virus, Juventus shares fell 11 per cent, forcing a suspension in trading.

Elsewhere in Europe, Frankfurt and Madrid fell by four per cent, Paris shedded 3.9 per cent and London lost 3.3 per cent.    

Wall Street’s Dow Jones was on track for its biggest daily decline in two years and the S&P 500 fell more than three per cent on Monday, as investors fled riskier assets as fears about the global economic impact of the coronavirus intensified after a surge in cases outside China.

The slump in US indexes followed a sell-off in markets overseas as a surge in cases of the disease in South Korea and Europe rattled investors.   

There are also more cases of the virus being reported in the Middle East as it spreads to Iran, Iraq, and Kuwait, among others.

The viral outbreak threatens to crimp global economic growth and hurt profits and revenue for a wide range of businesses.

Women wearing a protective facemask visit the Gallery Vittorio Emanuele II, close to the Piazza del Duomo in central Milan

Women wearing a protective facemask visit the Gallery Vittorio Emanuele II, close to the Piazza del Duomo in central Milan

The Spanish IBEX 35 dropped almost 3 percent at the start of the trading day under the fear of a quick coronavirus spread outside China

The Spanish IBEX 35 dropped almost 3 percent at the start of the trading day under the fear of a quick coronavirus spread outside China

Richard Hunter, head of markets at investment platform Interactive Investor, said: ‘The sombre realisation that cases outside of China could represent the early stages of a pandemic, with the lockdown in Italy adding to new reported instances in Asia and Korea, have not only ignited fears on the human level, but also that the economic impact could be more severe than initially envisaged.’

It follows a string of warnings from big businesses already unsettled by coronavirus. Jaguar Land Rover said it was having to fly components out of China in suitcases last week as factory shutdowns caused supply chains to reach a standstill and the carmaker admitted it may not have enough parts to sustain production beyond March. 

Airlines and other companies that depend on travelers are facing pain from cancelled plans and shuttered locations.

Technology companies were among the worst hit by the sell-off. Apple, which depends on China for a lot of business, slid 4.8 per cent. Microsoft dropped 4.3 per cent. Banks were also big losers. JPMorgan Chase fell 2.7 per cent and Bank of America slid 4.7 per cent.

Airlines and cruise ship operators also slumped. American Airlines lost 8.5 per cent, Delta Air Lines dropped 6.3 per cent, Carnival skidded 9.4 per cent and Royal Caribbean Cruises tumbled 9 per cent.  

Read more at DailyMail.co.uk