Stock markets around the world fell sharply on Friday, while Germany’s flagship airline said it would cut up to half its flights and oil prices plunged.
As a rising numbers of companies sound the alarm on the hit to profits, impose travel bans and put in place contingency plans to protect staff, the FTSE 100 plunged by 3.5% amid steep losses on stock markets elsewhere across Europe.
What is Covid-19 - the illness that started in Wuhan?
It is caused by a member of the coronavirus family that has never been encountered before. Like other coronaviruses, it has come from animals.
What are the symptoms this coronavirus causes?
The virus can cause pneumonia. Those who have fallen ill are reported to suffer coughs, fever and breathing difficulties. In severe cases there can be organ failure. As this is viral pneumonia, antibiotics are of no use. The antiviral drugs we have against flu will not work. Recovery depends on the strength of the immune system. Many of those who have died were already in poor health.
Should I go to the doctor if I have a cough?
In the UK, the medical advice is that if you have recently travelled from areas affected by coronavirus, you should:
- stay indoors and avoid contact with other people as you would with the flu
- call NHS 111 to inform them of your recent travel to the area
More NHS advice on what to do if you think you have been exposed to the virus can be found here, and the full travel advice to UK nationals is available here.
Is the virus being transmitted from one person to another?
China’s national health commission confirmed human-to-human transmission in January, and there have been such transmissions elsewhere.
How many people have been affected?
As of 9 March, more than 110,000 people have been infected in more than 80 countries, according to the Johns Hopkins University Center for Systems Science and Engineering.
There have over 3,800 deaths globally. Just over 3,000 of those deaths have occurred in mainland China. 62,000 people have recovered from the coronavirus.
Why is this worse than normal influenza, and how worried are the experts?
We don’t yet know how dangerous the new coronavirus is, and we won’t know until more data comes in. Seasonal flu typically has a mortality rate below 1% and is thought to cause about 400,000 deaths each year globally. Sars had a death rate of more than 10%.
Another key unknown is how contagious the coronavirus is. A crucial difference is that unlike flu, there is no vaccine for the new coronavirus, which means it is more difficult for vulnerable members of the population – elderly people or those with existing respiratory or immune problems – to protect themselves. Hand-washing and avoiding other people if you feel unwell are important. One sensible step is to get the flu vaccine, which will reduce the burden on health services if the outbreak turns into a wider epidemic.
Have there been other coronaviruses?
Severe acute respiratory syndrome (Sars) and Middle Eastern respiratory syndrome (Mers) are both caused by coronaviruses that came from animals. In 2002, Sars spread virtually unchecked to 37 countries, causing global panic, infecting more than 8,000 people and killing more than 750. Mers appears to be less easily passed from human to human, but has greater lethality, killing 35% of about 2,500 people who have been infected.
The leading index of UK company shares dropped by 234 points to 6,471, the lowest point since late June 2016 immediately after the EU referendum, with airlines and travel firms among the hardest hit as heavy selling pressure returned to markets around the world.
Lufthansa said it planned to cut as many as half of its flights in the coming weeks because of the fallout from coronavirus, just days after announcing a 20% reduction. The plan includes potentially grounding the carrier’s entire fleet of A380 superjumbos.
“In recent days, the Lufthansa Group has been exposed to drastic declines in bookings and numerous flight cancellations due to the spread of the Covid-19 virus. All traffic areas are now affected,” it said in a statement.
The airline industry has warned it faces revenue losses of $113bn (£87bn) in the event of a prolonged outbreak. Shares in budget airline Norwegian also plunged on concerns over its finances.
Wall Street was also hit with the Dow Jones Industrial Average falling by 256.23 points, or 0.98%, to 25,865.05 on Friday. However, the index closed the week higher for the first time in three weeks, and saw the biggest weekly percentage gain for four.
The world’s largest economy reported a boom in jobs growth in February. Although usually a reflection of economic strength, the jobs figures were compiled in the middle of last month, before US companies and investors had begun to really worry about the coronavirus outbreak’s impact on the US economy.
As investors offloaded shares in riskier assets, surging demand for safe havens pushed the yield on benchmark government bonds to new record lows – where a lower yield means a higher price. The UK 10-year gilt yield fell as low as 0.206% in afternoon trading, having started the day at 0.33%.
The price of oil plunged by about 8% to $46 a barrel after the Opec group of oil-rich nations failed to reach an agreement to cut production, seen as vital to support the price as global energy demand slides. In a reflection of the growing pressure on the world economy, factory closures and weaker trade volumes have sapped demand.
Chris Iggo of the fund manager Axa Investment Managers said: “The retrenchment of normal business activity is creating victims as well as generating extreme moves in financial markets. We probably won’t quickly return to business as usual.”
Markets had rallied earlier this week as finance ministers and central bankers in the G7 group of rich nations promised a coordinated response to the outbreak, while the US Federal Reserve issued an emergency interest rate cut to support households and firms through the worst of the disruption.
However, analysts have warned that central banks lack adequate firepower to respond to the economic fallout triggered by efforts to contain the disease, with interest rates in most advanced nations remain close to the lowest levels on record following a slow decade of economic recovery since the financial crisis.
Escalation of quarantine measures are expected to hit retail, with travel and tourism firms also reporting weaker bookings.
Companies around the world have also started to take tougher steps to contain the spread of the disease, against a backdrop of rising global concern as the number of infections passed 100,000.
Facebook closed its London offices and told staff to work from home after an employee was diagnosed with Covid-19, Sky News reported. The staff member is normally based in Singapore but visited the London office from 24-26 February.
Jaguar Land Rover warned it had suffered an 85% drop in sales in China last month as the coronavirus kept buyers indoors and most dealerships shut.
