Stocks climbed in the US on Monday after central banks around the world pledged measures to stabilise economies from the impact of the outbreak.
Stocks were weaker in Europe amid warnings that the spread of coronavirus was the biggest threat to the global economy since the 2008 financial crisis.
The pan-European STOXX 600 index (^STOXX) erased earlier gains, and was down by around 0.2%.
The FTSE 100 (^FTSE) was up by around 0.4% in London as the Bank of England said that it would take “all necessary steps” to fight the economic fallout of coronavirus.
“The Bank continues to monitor developments and is assessing its potential impacts on the global and UK economies and financial systems,” a spokesperson for the Bank of England said on Monday.
The US Federal Reserve on Friday also signalled a strong policy response to the coronavirus fallout with an emergency statement.
The Organisation for Economic Co-operation and Development (OECD) on Monday slashed its forecasts for economic growth in 2020, saying it now expects the world’s economy to grow by just 2.4% in 2020.
That would represent the slowest annual growth since 2012 and compares with a forecast of 2.9% made in November.
The mixed trading session in Europe followed broad gains for stocks in Asia.
The Bank of Japan issued an emergency statement, saying it would provide “ample” liquidity to the country’s financial markets through short-term loans and asset purchases, raising hopes that other central banks would follow suit.
“The Bank of Japan will closely monitor future developments, and will strive to provide ample liquidity and ensure stability in financial markets through appropriate market operations and asset purchases,” said Haruhiko Kuroda, the governor of the Bank of Japan.
The measures come after Italy’s government on Sunday pledged to inject €3.6bn (£3bn, $4bn) into the country’s economy, including by offering tax credits for firms that suffer a 25% fall-off in revenues, by introducing tax cuts, and by spending extra money on the health system.
The country last week became the epicentre of coronavirus in Europe, and there have now been almost 1,700 cases of the virus in the country, and 34 related deaths.
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