This Thursday morning, we once again witnessed a plunge by the major European financial centres after Donald Trump's announcement ofa 30-day suspension of entry into the United States for travellers who have recently been in Europe other than US citizens. The European Union, for its part, is preparing to assess the economic impact of this decision as a matter of urgency. Let us return together to this news and its consequences on the markets.Trade on the Euro Stoxx 50 Index!
So it was during a solemn speech that US President Donald Trump announced the sad news for the EU. He said: "I have decided to take strong but necessary action to protect the health and well-being of all Americans. To prevent further cases from entering our country, I will suspend all travel from Europe to the United States for the next 30 days. "
He also deplored the fact that the European Union has not taken the same precautions.
The drastic measure thus taken by the United States should come into force this Friday at midnight (Washington time), i.e. 4h Saturday in France and will not concern the United Kingdom.
Also in his speech, Donald Trump also described the new coronavirus as a â€œforeign virusâ€. Note that this is not the first blunder of this kind since Mike Pompeo, head of the country's diplomacy, before already calling the Covid 19 "Wuhan virus" last week.
As soon as this new measure was announced, the markets reacted strongly with a drop in most European stock markets but also a 6% drop in oil in Asia. The Japanese and Hong Kong stock exchanges also fell very sharply as did the Australian stock exchange which experienced its worst session since the 2008 crisis with a drop of 7.4%.
The European Union must assess the situation today to avoid further economic disruption.
The coronavirus has already infected more than 20,000 people in Europe and caused 930 deaths. Internationally, more than 124,000 cases have been reported in 113 different countries with 4,566 deaths. The United States is not spared by this health crisis with already 900 cases registered and 28 deaths. The WHO has just reclassified Covid-19 as a pandemic and the virus continues to disrupt the sight of affected populations a little more each day with the restriction of their movements and the increasingly frequent closures of public places.
For their part, the major international financial institutions have announced massive aid, including Germany, which says it is prepared to abandon the zero budget deficit rule. The ECB, for its part, is expected to unveil the measures to be taken during the day. Finally, Australia has already announced a stimulus package of more than 10 billion euros.