The Paris Stock Exchange plunged 4.14% Friday, in a panicked market both by the sharp fall in oil prices and by the spread of the coronavirus epidemic, especially on American soil, raising fears of a significant economic impact on the United States, previously spared. The CAC 40 index fell from 221.99 points to 5,139.11 points, in a trade volume still extremely rich of 7.6 billion euros.
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The day before, the Paris index had already ended in sharp decline (-1.90%). This is the largest dip in the index on a session since June 24, 2016, the day after the Brexit referendum. The CAC 40 unscrewed to 5,117.57 points, the lowest for more than a year. Over the past week, it has lost 3.22%. Since January 1, it has dropped 14.03%.
The London Stock Exchange for its part tumbled Friday by 3.62%, after having already retreated the day before because of fears which are piling up on the economic impact of the epidemic of new coronavirus. The Frankfurt Stock Exchange also ended down, the Dax yielding 3.37%. The Milanese index ended the week with a drop of 3.5%. And it's also all of Wall Street that opened lower Friday. The flagship index of the New York Stock Exchange, the Dow Jones Industrial Average, yielded 3.12%, to 25,305.84 points. The Nasdaq, with a strong technological coloring, fell by 3.24%, to 8,455.78 points. The S&P 500, which represents the 500 largest companies on Wall Street, lost it 3.40%, to 2,921.27 points.
"A theme has been added to that of the coronavirus, that of petroleum"
The number of cases of contamination worldwide has exceeded 100,000 people in 91 countries and the virus has already claimed more than 3,400 lives. "A theme has been added to that of the coronavirus, that of petroleum, whose prices in the United States have reached a lowest since August 2016" and since June 2017 in London, stressed to AFP Alexandre Baradez, analyst at IG France. The Organization of the Petroleum Exporting Countries (OPEC) and its main Russian ally were unable to agree on Friday to amplify their production cuts in order to stem the fall in crude prices affected by the new coronavirus epidemic. In addition, "the big question mark of the markets is how the situation will evolve in the United States", where 220 cases were identified Friday morning.
If Donald Trump wanted to be reassuring on Friday, assuring that the markets would "rebound" and calling on the Fed to lower rates again to stimulate the economy, his main economic adviser, Larry Kudlow, admitted that the American economy " is expected to slow in the next quarter. "
The coronavirus, on the other hand, is boosting the gold market, at its highest level in seven years, with investors finding a safe haven there when others plunge.