London Apr 2: Stock markets sank on Wednesday after US President Donald Trump warned of “a very, very painful two weeks” to come for the United States, whose coronavirus death toll has overtaken that of China.
European equities fell hard, with London down 3.7 per cent in afternoon trading. Tokyo earlier closed down 4.5 per cent. Wall Street opened sharply lower, with the Dow falling 4.0 per cent. Adding to the gloom, UK banks axed billions of pounds in shareholder dividends and stock buybacks after the Bank of England requested the move to boost liquidity as part of measures to stimulate the virus-hit economy.
Investor sentiment in Europe was also knocked by poor manufacturing survey data, jangling market nerves before Friday’s key US non-farm payrolls figures. The euro dropped against the dollar and pound. “Trump’s warning is the primary driver of today’s downturn,” Oanda analyst Craig Erlam told AFP. “It’s such a shift from his previous views on the impact of the coronavirus and finally an acceptance of how severe the situation is.” Asian bourses also dropped after a dire first quarter for markets.