(BEIJING) — Global stock markets and oil prices plunged Monday after a squabble among crude producers jolted investors who already were on edge about the surging costs of a virus outbreak.
The main stock indexes in London and Frankfurt dropped by more 8% at the opening. Tokyo closed down 5.1% while Sydney lost 7.3% and Shanghai was off 3%.
The benchmark U.S. crude price fell as much as 30%, deepening a rout that began when Saudi Arabia, Russia and other major producers failed to agree on how much to cut output to prop up prices.
Investors usually welcome lower energy costs for businesses and consumers. But the abrupt plunge, amid anxiety over the coronavirus, rattled markets.
“Investors should brace for volatility,” James Trafford of Fidelity International said in a report.
A recovery in oil and stock prices “will require some stabilization in the coronavirus data points” or signs of agreement among crude producers, Trafford said.
In Saudi Arabia, the Riyadh stock exchange suspended trading of state-owned oil giant Saudi Aramco after its share price sank by the daily 10% limit at the opening.
Investors already were on edge about the mounting costs of the coronavirus outbreak that began in China and has disrupted world travel and trade.
Anxiety rose after Italy announced it was isolating cities and towns with some 16 million people, or more than one quarter of its population.
In early trading, London’s FTSE 100 tumbled 8.6% to 5,910.87 and Frankfurt’s DAX shed 8% to 10,616.42. The CAC 40 in France lost 2.7% to 5,001.53.
On Wall Street, the future for the Dow Jones Industrial Average lost 1,255.00 points, or 4.9%, while the S&P 500 future contract also lost 4.9%.
Souces: https://time.com/5799323/markets-plunge-oil-price-coronavirus/