European markets dropped dramatically again Monday as the region’s officials scrambled to contain the spread of the COVID-19 pandemic, and U.S. markets were set to open sharply lower as well.
Meanwhile, in the U.S., the Federal Reserve threw out another effort at an economic lifeline on Sunday by cutting the benchmark interest rate to 0 to 0.25 percent.
“The effects of the coronavirus will weigh on economic activity in the near term and pose risks to the economic outlook,” the Federal Reserve said in a statement Sunday. “The committee expects to maintain this target range until it is confident that the economy has weathered recent events and is on track to achieve its maximum employment and price stability goals.”
The CAC 40 in Paris fell about 370 points to roughly 3,745, a nearly 9 percent drop, while the FTSE in London fell some 376 points to 4,990, a roughly 7 percent drop. The FTSE MIB in Milan fell 1,480 points to 14,490, about a 9 percent drop.
Luxury brands deflated Monday, with Moncler SpA dropping 10.7 percent to 26.52 euros; Salvatore Ferragamo Italia SpA, 2.2 percent to 9.94 euros; LVMH Moët Hennessy Louis Vuitton, 9.5 percent to 288 euros; Kering, 11.1 percent to 360 euros; Burberry Group plc 10 percent to 12.49 pounds, and Hermès International, 4.5 percent to 547 euros.
The numbers reflect the market panic that hasn’t abated since the global spread of COVID-19 gained speed. As of Monday, there were at least 169,387 confirmed cases and more than 6,500 resulting deaths, according to a Johns Hopkins University tally.
Italy, France, Germany and Spain have all announced steps to stop the spread of the illness, which in most cases presents mild symptoms but can be more serious to elderly patients and those with other health conditions.
French Prime Minister Édouard Philippe issued an order closing nonessential businesses including retail stores, restaurants and cinemas, as Spain locked down and Germany restricted travel between bordering nations including France and Austria.
In the U.S., President Trump on Friday officially declared the spread of COVID-19 a national emergency, a designation that will allow the government to help dispatch up to $50 billion in funding to address the crisis.