Australia

The Australian stock exchange seems headed for falls of more than 2 per cent after US markets fell following a rise in the number of coronavirus cases.

The SPI200 futures contract was down 136 points, or 2.12 per cent, at 6,271 at 8am Sydney time on Friday.

US equities fell sharply overnight as coronavirus fears intensified after the number of cases confirmed in the US rose to 164 and California declared a state of emergency.

On Wall Street, the Dow Jones Industrial Average fell 969.17 points, or 3.58 per cent, to 26,121.69, the S&P 500 lost 3.39 per cent and the Nasdaq Composite dropped 3.1 per cent.

Local investors will be watching out for retail spending figures for January, to get a snapshot of the health of Australia's retail sector and consumer spending.

The Aussie dollar was buying 66.02 US cents at 8am on Friday, down from 66.28 as the market closed on Thursday.

Asia

Blue-chip stocks in China climbed more than 2 per cent to seven-week highs on Thursday, as investors expected more policy support from Beijing after major central banks cut rates to soothe the economic pain of the coronavirus epidemic.

The blue-chip CSI300 index jumped 2.2 per cent, hitting its highest level since 14 January. The Shanghai Composite index reached its six-week high during the afternoon session and settled 2 per cent higher at 3071.68.

The Hong Kong stock market rose the most in a month on Thursday on hopes that global central banks, including China’s, will ramp up policy easing to offset economic pressure from the coronavirus outbreak.

At the close of trade, the Hang Seng index was up 2.1 per cent at 26,767.87, near its highest level since last Thursday touched during the session. The index also made the largest daily percentage uptick since 6 February.

Around the region, MSCI’s Asia ex-Japan stock index was firmer by 1.3 per cent, while Japan’s Nikkei index closed up 1.1 per cent.

Europe

European shares snapped a three-day gaining streak on Thursday as concerns over the scale of economic damage caused by the coronavirus outbreak overtook optimism over support from monetary stimulus.

Resources was the worst performing sector as several heavyweight miners, including BHP Group and Rio Tinto, traded ex-dividend. The two stocks lost about 6 per cent and 7 per cent for the day, respectively.

The main European equity benchmark ended 1.4 per cent lower after the death toll from the outbreak rose to more than 3,300, with several more companies providing profit warnings because of disruptions caused by the coronavirus.

Hopes of stimulus from several major central banks to stymie the impact of the outbreak had stabilised the index this week, but questions had remained about whether central banks would be able to completely shelter big economies.

Analysts firmly expect the European Central Bank to cut interest rates by 10 basis points next week.

Travel and leisure stocks dropped 2.9 per cent, with the sector ranking among the worst hit by the virus.

Airline stocks plunged after British regional airline Flybe collapsed, making the struggling carrier the industry’s first big casualty of the outbreak.

British commercial broadcaster ITV fell 12 per cent after warning that ad revenue for April could fall by about 10 per cent as travel companies put back campaigns.

German auto supplier Continental slumped 12.4 per cent after it posted a net loss of 1.2 billion euros ($1.34 billion) in 2019, with the broader carmakers index dropping 3.4 per cent in tow.

Heavyweight bank HSBC dropped 1.2 per cent after it sent more than 100 of its London staff home after a worker tested positive for the coronavirus.

Broader bank stocks retreated in the face of steadily dropping bond yields.

Ratings agency Fitch said on Thursday the spread of the coronavirus in the EU opens new channels for it to affect the regional economy and heightens its adverse impact on GDP growth.

Rabobank’s Elwin said the EU would probably have two quarters of zero-to-negative growth, with some countries showing negative growth in 2020.

Among stocks in the black was German food delivery firm Hellofresh which was one of the top gainers on the STOXX 600 after JP Morgan upgraded the stock.

North America

US stocks tumbled on Thursday, with shares of banks and travel companies taking a beating, as a new wave of fear about the spread of the coronavirus and its economic impact gripped investors just one day after election results powered a rally.

The major indexes fell over 3 per cent. On Wednesday the market tallied huge gains following moderate Joe Biden’s success in the Super Tuesday primaries for the Democratic presidential nomination.

The coronavirus has led to more than 3300 deaths worldwide. In the US, new cases of the vast-spreading virus were reported on Thursday around New York and in San Francisco.

In the latest developments, Alphabet Inc’s Google joined other big tech firms in recommending employees in the Seattle area work from home.

The Dow Jones Industrial Average fell 969.58 points, or 3.58 per cent, to 26,121.28, the S&P 500 lost 106.18 points, or 3.39 per cent, to 3023.94 and the Nasdaq Composite dropped 279.49 points, or 3.1 per cent, to 8738.60.

The benchmark S&P 500 ended down more than 10 per cent from its Feb. 19 closing high, after last week logging its biggest weekly percentage decline since October 2008.

The financial sector dropped 4.9 per cent as the continued fall in Treasury yields weighed on rate-sensitive bank shares. The yield on the 10-year Treasury note fell to 0.91 per cent.

Shares of JPMorgan Chase dropped 4.9 per cent and Bank of America Corp slid 5.1 per cent.

All 11 major S&P 500 sectors ended negative, but defensive sectors, such as utilities and consumer staples, fell less than the overall market.

The CBOE Volatility index, Wall Street’s fear gauge, jumped 7.62 points to 39.61.

Shares of companies in the travel and leisure industry were punished. The S&P 500 airline index skidded 8.2 per cent, including a 13.4 per cent fall for American Airlines Group Inc.

The coronavirus epidemic could rob passenger airlines of up to $113 billion in revenue this year, an industry body warned.

Shares of cruise operators tumbled after the Grand Princess ocean liner, owned by Carnival Corp, was barred from returning to its home port of San Francisco on coronavirus fears after at least 20 people aboard fell ill. Carnival shares dropped 14.1 per cent, while Royal Caribbean Cruises fell 16.3 per cent.

Data showed that the number of Americans filing for unemployment benefits fell last week, suggesting the labour market was on solid footing despite the coronavirus outbreak, with investors casting an eye toward Friday’s US employment report for February.