The Dow Jones Industrial Average has endured its worst ever daily points loss as global markets react to the latest dire news on the spread of coronavirus.

Markets were running scared as Monday began after America's central bank, the Federal Reserve, slashed its benchmark interest rate to near zero on Sunday night in an attempt to help the US economy come through the COVID-19 outbreak.

The Fed also said it would expand its balance sheet by at least $700bn (£565bn) in the coming weeks to help stabilise market confidence.

Americans rush to board final planes to US

After falls in Asia, the FTSE 100 in the UK was trading more than 400 points or 8% down by lunchtime at 4,926, though it closed 4% lower at 5,151.

Airlines and holiday firms led the fallers following a slew of announcements relating to the grounding of planes and warnings that the industry will need the support of governments globally to survive the crisis intact.


IAG, the owner of British Airways, was 28% down at one stage while holiday operator TUI saw its shares plunge by more than 30% after it warned the "vast majority" of its holidays were being cancelled.

The CAC in France and German DAX were both more than 10% lower mid-session but also fought back to lose 5.75% and 5.3% respectively.

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Trading in US stock markets was suspended shortly after the opening bell when values on the S&P 500 and Dow Jones Industrial Average tumbled by more than 7% - triggering so-called circuit breakers to ease volatility.

Both later resumed more than 10% down and losses intensified for a while as Mr Trump outlined an escalation in the US response to tackle COVID-19, warning that a recession may be on the way but he expected the economy and stock markets to bounce back strongly once the worst was over.

The Dow ended the day 13% down and lost a record 2,997 points. It was the worst day, in terms of percentage losses, for both indices since the Black Monday falls of 1987.

Brent crude oil was 10% down at just $30 per barrel given a slump in global demand coupled with Saudi threats to pump at record levels from next month in a bid to punish Russia for refusing to sign up to steep output cuts to support prices.

Financial analysts saw no end to the stock sell-off in sight as the news on coronavirus gets worse on a daily basis and a growing number of companies cut or suspend operations.

Firms are working 24/7 to keep people safe & operations going.



2 things matter most:



1⃣ Vital public services from food to energy stay functioning



2⃣ As many firms as possible survive to sustain economy



Big action needed fast.@cbicarolyn on @SkyNews @IanKingSky pic.twitter.com/z5Klv6wPaG — CBI (@CBItweets) March 16, 2020

Vauxhall's owner, PSA, was among firms to announce just that on Monday - saying it was to temporarily suspend output at all its factories, including Ellesmere Port and Luton in the UK, this week until 27 March at least.

It cited efforts to combat the spread of COVID-19 and supply issues alongside the collapse in the car market globally.

Sectors facing massive disruption, such as retail, hospitality and airlines, have appealed for government support.

Leaders of the G7 group of wealthy nations, including the UK, said in a statement following a call they were committed to doing "whatever is necessary" to battle the pandemic and to work together more closely to protect public health, jobs and growth.

The finance ministers of the countries which use the euro currency later said they had agreed a fiscal support plan, worth around 1% of annual GDP, to support economic activity.

Central banks are also facing pressure to bolster their measures in support of business.

Andrew Bailey, who replaced Mark Carney as Bank of England governor on Monday, said the bank was "very keen" to ensure short-term damage to the UK economy did not permanently impair longer-term growth.

"That's why you saw prompt action last week, that's why you will see prompt action again when we need to take it, and the public can be assured of that," he said.

Mr Bailey said a move on Sunday by six central banks, including the BoE, to inject cheap US dollar funds to the financial system was in response to some "pretty big dislocations" in markets.

"We're going to see how that works its way through the markets today (and) in the coming days to see what the effect is, but I would emphasise that this is strong coordination among central banks."

Other central banks around the world, including the Bank of England, have said they would co-ordinate to ease liquidity in an attempt to blunt the economic impact of the virus.

A Bank statement on Sunday said such action would "improve global liquidity by lowering the price and extending the maximum term of US dollar lending operations".

It added: "These new operations will help ease strains in global funding markets, thereby supporting the supply of credit to households and businesses."