Governments and central banks readied more emergency measures to tackle the economic impacts of the coronavirus on Friday as Asian markets suffered their worst weekly crashes since the 2008 financial crisis.
Canadian Prime Minister Justin Trudeau’s wife, Sophie, was among several thousand people newly diagnosed with the COVID-19 respiratory disease that has now infected almost 135,000 and killed more than 4,900 worldwide.
Experts warn that due to a lack of testing and unreported cases, many more people may be affected by the outbreak that emerged in the Chinese city of Wuhan late last year.
Major sporting events have been canceled or postponed, large public gatherings restricted or banned and schools closed.
“There is a sense of fear and panic,” said James Tao, an analyst at stockbroker Commsec in Sydney, where phones at the high-value client desk rang non-stop.
“It’s one of those situations where there is so much uncertainty that no-one quite knows how to respond … if it’s fight or flight, many people are choosing flight at the moment.”
Japan’s Nikkei was in freefall, dropping 10% after Wall Street stocks slumped about 10% on Thursday, their worst day since the 1987 “Black Monday” crash. [.N]
Travelers in Europe rushed to board flights to the United States after U.S. President Donald Trump imposed sweeping restrictions on travel from the continent, a decision that angered European leaders and frightened investors.
Trump also suggested the 2020 Olympics in Tokyo could be delayed by a year.
“Maybe they postpone it for a year … if that’s possible,” Trump told reporters. “I like that better than I like having empty stadiums all over the place.”
Tokyo 2020 organizers insisted they were moving ahead with preparations to hold “safe and secure” Games on schedule, starting in July.
Still, Japan must take “bold and unprecedented” steps to beat the economic impact of the virus, its economy minister said, suggesting large-scale fiscal stimulus was in the works.
U.S. lawmakers and the White House neared agreement on a coronavirus economic aid package, with House Speaker Nancy Pelosi saying she hoped to announce a deal on Friday.
The U.S. Federal Reserve on Thursday offered a hefty $1.5 trillion in short-term loans to stimulate the economy and stabilize the financial system.
Australia’s central bank followed suit, pumping an usually large amount of cash into the system on Friday as panic selling across global markets threatened to drain liquidity and push up borrowing costs.