Asian and European stocks struggled on Friday on news of rapidly-shrinking economic activity, highlighting the "devastating impact" of coronavirus on the global economy, analysts said.
A tweet from US President Donald Trump suggesting delay in November's elections also jolted investors, helping send the euro soaring to a new two-year peak at $1.1909 in early Asian deals.
Equities in Europe aimed higher despite more grim corporate earnings, and as nations in the region unveiled the extent of historic economic devastation wrought by Covid-19.
France's economy contracted by a record 13.8% in the second quarter, Spain went into recession after its gross domestic product (GDP) slumped 18.5%, Portugal's economy contracted 14.1% and Italy's GDP plunged 12.4%. Europe, as a whole, was hammered by its sharpest recorded contraction in the second quarter, with GDP down 12.1% in the euro zone and 11.9% across the bloc.
"GDP figures released today (Friday) confirmed the devastating economic impact of the pandemic," noted Oxford Economics analyst Rosie Colthorpe. "GDP figures all showed historic contractions in output but that the pandemic has caused such massive economic damage is not a surprise."
Historic contractions have been additionally recorded in Germany (10.1%), Belgium (12.2%), Austria (10.7%) and Mexico (17%).
Across the Atlantic, the Commerce Department sent shockwaves across markets with news that the US economy contracted 32.9% between April and June as businesses were shut down to prevent the spread of the killer disease.
Published in The Express Tribune, August 1st, 2020.
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