Here’s the latest news on how the COVID-19 crisis is affecting the economy. For more on financial resources available during the pandemic, click here.
After 3-day rally, markets slip Friday
After three days of back-to-back gains, U.S. financial markets slipped Friday as the coronavirus pandemic wages on.
The Dow Jones Industrial Average was down more than 900 points, or over 4%, when U.S. markets closed Friday. The S&P 500 and Nasdaq also both dropped by more than 3%.
The fall comes as the United States now has nearly 86,000 cases of COVID-19, the highest number in the world. At least 1,300 people have died in the U.S.
Moreover, in New York City — the new epicenter of the coronavirus pandemic — Mayor Bill de Blasio projected Friday morning that “over half the people in this city will ultimately be infected.”
Equity markets have seesawed for weeks as the COVID-19 outbreak has sowed uncertainty among investors.
A $2 trillion stimulus package to help lessen the blow of the outbreak on the economy was approved by the Senate earlier this week, leading to the three-day market rally ahead of Friday’s tumble.
IMF chief predicts a ‘quite deep’ recession for 2020
Kristalina Georgieva, the managing director of the International Monetary Fund (IMF) said in a briefing Friday that the organization representing more than 189 countries is now projecting a recession for 2020.
Moreover, “we are expecting it to be quite deep,” she said.
“We are very much urging countries to speed up containment measures aggressively so we can shorten the duration of this period of time when the recession is in standstill,” she said. “And also to apply well-targeted measures, primary focusing on the health system to absorb that enormous stress that comes from coronavirus and on people, businesses, and the financial system.”
She applauded countries’ fiscal and monetary policy responses so far for both their speed and breadth.
In a statement shortly after Friday’s briefing, Georgieva and the IMF’s Financial Committee Chair Lesetja Kganyago called for increased multilateral action among central banks and other financial institutions.
“We are in an unprecedented situation where a global health pandemic has turned into an economic and financial crisis. With a sudden stop in economic activity, global output will contract in 2020. Member countries have already taken extraordinary actions to save lives and safeguard economic activity. But more is needed,” they said in a joint statement.
It continued: “Priority should be afforded to targeted fiscal support to vulnerable households and businesses to accelerate and strengthen the recovery in 2021.”
Facebook CEO Mark Zuckerberg pledges $25 million for coronavirus treatment funding
Facebook chief Mark Zuckerberg said Friday that he and his wife, Dr. Priscilla Chan, will give $25 million to accelerate the development of coronavirus treatments, saying he hopes to get a vaccine to test developed in “months rather than a year or more.”
“We’re partnering with the Gates Foundation and others to quickly evaluate the most promising existing drugs to see which ones might be effective at preventing and treating the coronavirus,” Zuckerberg said in a Facebook post Friday morning. “Since these drugs have already gone through clinical safety trials, if they’re effective, it will be much faster to make them available than it will be to develop and test a new vaccine — hopefully months rather than a year or more.”