TEMPO.CO, Geneva - Hopes the coronavirus would be contained to China vanished on Friday, Feb. 28, as infections spread rapidly around the world, countries started stockpiling medical equipment and investors took flight in expectation of a global recession.
Share prices were on track for the worst week since the global financial crisis in 2008 as virus-related disruptions to international travel and supply chains fuelled fears of recession in the United States and the Euro zone.
The U.S. stock market fell into correction territory with the benchmark S&P 500 index down more than 4% on Thursday, extending a market rout that has now sliced more than 10% off of its closing peak on Feb. 19.
"Markets are voting and saying they think the U.S. is on its way to recession," said Chris Rupkey, chief economist at MUFG in New York.
"And frankly at this stage after the coronavirus-related slowdown in travel plans that has busted the global supply chain apart, it will be a miracle if we avoid a recession."
Mainland China - where the virus originated late last year - reported 327 new cases on Friday, the lowest since Jan. 23.
But with new infections reported around the world now surpassing those in China, World Health Organization (WHO) Director General Tedros Adhanom Ghebreyesus said even rich nations should prepare.
"No country should assume it won't get cases, that would be a fatal mistake, quite literally," Tedros said, pointing to Italy, where 17 people have died in Europe's worst outbreak.
A Reuters tally showed almost 10 countries reported their first virus cases in past 24 hours.
In addition to stockpiling medical supplies, governments ordered schools shut and canceled big gatherings, including sports events, to try to halt the spread of the flu-like disease known as COVID-19.
U.S. President Donald Trump's administration was considering invoking special powers to rapidly expand U.S. production of protective gear, two officials told Reuters.
In Europe, France's number of reported cases doubled, Germany warned of an impending epidemic and Greece, a gateway for refugees from the Middle East, announced tighter border controls.
"We have a crisis before us. An epidemic is on its way," French President Emmanuel Macron said.
The number of people who tested positive for the illness in Italy increased by more than 200 to 650. Germany has about 27 cases, France around 18 and Spain 15.
Tedros told reporters in Geneva that Iran, Italy and South Korea were at a "decisive point" in their efforts to prevent a wider outbreak.
U.S. investment bank BofA cut its world growth forecast to the lowest level since the peak of the financial crisis, and ratings agency Moody's said a coronavirus pandemic would trigger global and U.S. recessions in the first half of the year.