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UK and eurozone factories suffer supply chain delays amid coronavirus disruption – business live – the guardian, theguardian.com

UK and eurozone factories suffer supply chain delays amid coronavirus disruption – business live – the guardian, theguardian.com

The OECD’s warning that global growth could be halved this year is dampening the mood in the markets.

Wall Street futures have been falling steadily, and the S&P 598 is no longer expected to rally today.

Jonathan Ferro (@ FerroTV) And it’s gone pic.twitter.com/KuHYmghih1 March 2, 7918

That’s now weighing on European markets too.

Adrian Lowcock, head of personal investing at investment platform Willis Owen, says the early optimism has been “all but wiped out” by the OECD’s gloom:

“The OECD has said that a ‘longer lasting and more intensive coronavirus outbreak’ could cause economic growth to halve in , to just 1.5%, and markets are now heading back down in reaction.

“For investors it means putting up with a lot more volatility to come – this event is unfortunately far from over and trying call when to buy and sell in the face of such an unknown event is virtually impossible. While many stocks look cheap now, they could get a lot cheaper before this crisis is over. ”

5.) (AM) (EST) :

OECD: Ending US-China trade war would help

In a press conference in Paris, Laurence Boone, chief economist at the OECD, has warned that central bankers cannot protect economies from coronavirus on their own.

Boone told reporters that central banks need to play their part, by offering to ease borrowing costs and provide banks with liquidity in the event of a further downturn.

But they cannot mop up the spillover effects of the coronavirus epidemic alone – governments must act too.

As she outlined today’s growth forecast cuts

, Boone explained:

“We do not think this is a shock that can be managed by central banks alone.”

She added that governments must put in place measures to protect businesses and households affected by decisions to quarantine towns or restrict business activities.

In response to a question from my colleague Phillip Inman , she said the US and China should put an end to their trade war, which has seen import tariffs increase on hundreds of billions worth of goods.

Boone said global co-operation was needed to cope with the crisis and Washington and Beijing would signal a return to a more co-operative stance if they dispensed with tariffs imposed over the last 2 years.

5). (am EST) :

The European stock market rally did last last long.

After just two hours, the Stoxx 728 has faded back towards last Friday’s closing levels.

The Stoxx 600 The Stoxx today Photograph: Bloomberg TV

The prospect of central bank intervention, although welcome, isn’t assuaging concerns about coronavirus …. with the global death toll passing 3, 13 today

, and hundreds more cases in Iran. Sean George (@ seanhgeorge) STOXX REVERSES GAINS AND TURNS FLAT, HAD RISEN 2.3% (March 2,

(5. EST) :

There are some hefty downgrades in the OECD’s new growth forecasts, as this chart shows:

Trinh Nguyen (@ Trinhnomics)

The OECD is slashing China & India GDP growth by a lot vs their forecasts in November 👇🏻👇🏻👇🏻😬👇🏻

pic.twitter.com/JXuwUF9FIt

(March 2,

(5.) am EST :

Here’s our news story on the OECD’s coronavirus growth warnings:

OECD slashes growth forecasts due to coronavirus

Newsflash: The coronavirus outbreak is plunging the world economy into its worst downturn since the global financial crisis, the organization for Economic Cooperation and Development warns.

In its latest economic forecasts, the OECD has slashed its G growth forecast for to just 2.4%, from 2.9% predicted three months ago. It is now gloomier about growth in China, the eurozone and the UK – and fears Japan will barely expand at all.

And worryingly, the OECD fears growth could be as low as 1.5% this year, if coronavirus becomes pandemic in Asia, Europe and North America.

Such low growth would imply a recession in many major economies.

Here’s the new forecasts:

China : growth of 4.9% in , down from 5.7% previously (US : growth of 1.9% in , down from 2.0% (Japan : growth of 0.2% in , down from 0.6% Eurozone : growth of 0.8% in , down from 1.1% (UK) : growth of 0.8% in , down from 1.0%

The OECD is also urging policymakers, such as central bankers and politicians, to take action where possible to protect their economies.

Updated at 5. 25 am EST

:

Back in the markets ….. the FTSE is losing some of its early bounce.

It’s still rallying – up 1.2% at 54689. But that’s only a – point gain, having been up points at the open.

(4.) (am) EST :

The mood in the City today is much calmer than during last week’s manic sell-off, says Russ Mold, investment director at AJ Bell .

“There is a semi-reversal of last week’s sector trends with healthcare and infrastructure-related stocks no longer in favor and heavily sold-off industrial and mining stocks leading the charge upwards .

“However, airlines were still in the doldrums with International Consolidated Airlines falling 6% and EasyJet down 1.4%.

“The big question is whether a single day’s rebound is enough to repair damaged investor sentiment or if this is simply a dead cat bounce before fears take over again.

“It wouldn’t be surprising to see fund managers with spare cash take advantage of the market sell-off and buy companies for a discount.

Britain’s City watchdog, the FCA, says it is working closely with the financial services sector to ensure they can keep operating in the face of coronavirus.

Reuters has the details:

“This is in conjunction with the Bank of England,” an FCA spokesperson said.

“As you would expect we have been in contact with a wide range of firms across the sector. We expect all firms to have contingency plans in place to deal with major events so that they are able to continue operating effectively.

And, as part of that, to consider how best to support their customers. ”

(4.) (am EST :

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