The growing COVID-19 coronavirus health crisis has been dealing heavy damage to the economy, damaging financial markets and causing major companies to cancel events and place restrictions on employees.
Amazon and Google have instructed their employees to limit nonessential travel as of Friday over fears of the virus. The situation has also caused large numbers of companies and individuals to announce they will no longer be attending planned events like San Francisco’s Game Developers Conference.
International business events including the Geneva International Motor Show, Facebook’s F8 developer conference, Mobile World Congress and the travel trade show IBT Berlin have been cancelled.
The airline industry is feeling financial effects of the crisis as well, with many flights cancelled to countries struggling to contain the virus. There were over 84,000 cases around the world in 59 countries as of Friday.
The New York Stock Exchange is said to be considering closing its trading floor due to panic over the virus’s potential spread. Some Wall Street firms have already restricted travel and prepared for employees being forced to work from home, according to Fox Business Network’s Charles Gasparino.
The week has seen U.S. markets suffer historic losses. The Dow Jones Industrial Average dropped 1,191 points on Thursday, the index’s largest ever single-day loss. The S&P 500 dropped 11 percent over the week, the worst loss since the 2008 financial crisis.
Markets around the world have also been impacted by coronavirus fears. The United Kingdom’s FTSE 100 was down 11 percent for the week, with Germany’s DAX falling 12 percent. Japan’s Nikkei 225 dropped 10 percent, the South Korean KOSPI fell 8 percent and Hong Kong’s Hang Seng Index lost 4 percent.
Experts have expressed concerns that ripple effects caused by the virus could result in long-term damage to the economy.
“The coronavirus is undoubtably having a near term impact on corporate earnings,” said Greg Portell, a global lead partner at management consultancy firm Kearney, in a statement to Newsweek. “The potential for a longer term drag on the economy is a legitimate concern.”
President Donald Trump and administration officials have reportedly discussed financial countermeasures including tax cuts, according to a Washington Post report citing five sources with knowledge of the conversations.
The possibility of applying pressure for the Federal Reserve to drop interest rates was also said to be a topic of discussion, although the Fed has already indicated that such a move could be made if the situation warrants.
“The fundamentals of the U.S. economy remain strong. However, the coronavirus poses evolving risks to economic activity,” Federal Reserve Chairman Jerome H. Powell said in a Friday press release. “The Federal Reserve is closely monitoring developments and their implications for the economic outlook. We will use our tools and act as appropriate to support the economy.”
The administration has been heavily criticized over their handling of the emerging health threat earlier in the week. Trump and his allies suggested that the criticism was part of a plot by Democrats to harm Republicans in the November election.
The president also suggested at a Wednesday news conference that the market’s plunge earlier in the week may have been due to a poor reaction to the Democratic debate on Tuesday, despite the fact that the debate occurred after two days of heavy losses had already happened.