‘Soggy start to April’: Stocks plunge as coronavirus ravages US and hammers Asian manufacturing

Confused, worried traderReuters/Brendan McDermid

  • Stocks dropped on Wednesday as investors worried about the novel coronavirus outbreak in the US and a sharp slowdown in Asian manufacturing.
  • President Donald Trump warned of a “very painful” two weeks to come as government scientists predicted 100,000 to 240,000 total domestic deaths from the pandemic.
  • Manufacturing surveys showed Japanese and South Korean factory activity slowed the most in roughly a decade in March.
  • “Global stocks got off to a soggy start in April as economic damage wrought by the coronavirus was laid bare,” one analyst said.
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Global stock markets tumbled on Wednesday as investors braced for a devastating US death toll from the novel coronavirus and reacted to disappointing Asian manufacturing data.

President Donald Trump warned the next two weeks would be “very painful” in a White House press briefing on Tuesday. US government scientists predicted between 100,000 and 240,000 deaths from the pandemic — a fraction of the 2.2 million lives that could be lost without measures such as lockdowns and social distancing.

The US currently leads the world in confirmed cases with about 190,000 to date. It has suffered more than 4,000 deaths from the disease.

Read more: Bank of America examined the stock market during every recession since 1929 and concluded the recent meltdown is not over. Here’s its trading strategy for a deeper crash.

Purchasing Managers’ Index surveys published on Wednesday suggested South Korean factory activity fell the most in 11 years in March, and Japanese manufacturing slowed the most in nine years. Indonesia, Vietnam, Thailand, and other Asian countries also registered sharp declines.

“Global stocks got off to a soggy start in April as economic damage wrought by the coronavirus was laid bare,” Neil Wilson, chief market analyst for Markets.com, said in a morning note. “Donald Trump reflected the mood.”

Read more: 5 corporate-debt experts break down how the coronavirus crisis is ravaging cash-strapped firms — and share what they’re buying to avoid risky ‘zombie’ companies

Here’s the market roundup as of 9:40 a.m. in London (4:40 a.m. ET):

  • European equities tumbled, with Germany’s DAX down 3.7%, Britain’s FTSE 100 down 4.3%, and the Euro Stoxx 50 down 3.7%.
  • Asian indexes slumped, with China’s Shanghai Composite down 0.6%, Hong Kong’s Hang Seng down 2.5%, and Japan’s Nikkei down 4.5%.
  • US stocks are set to open lower, with futures underlying the Dow Jones Industrial Average, the S&P 500, and the Nasdaq down between 3% and 3.5%.
  • Oil prices slid, with West Texas Intermediate down 1.4% at $20.20, and Brent crude down 5.3% at about $25.
  • The benchmark 10-year Treasury yield dropped below 0.63%.
  • Gold rose 0.6% to $1,606.
  • Bitcoin fell about 3% to around $6,300.

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