* European stocks tumble, Italy down more than 5% after virus spread
* Thirty-year Treasury yields set record low
* Gold prices surge to highest level since 2013 (Updates prices, adds analyst comments)
By Rodrigo Campos
NEW YORK, Feb 24 (Reuters) - Stocks across the globe were on track to fall by the most in two years on Monday and oil prices tumbled as a jump in coronavirus cases outside of China drove investors to the perceived safety of gold and government bonds on fears of the impact to the global economy.
Spot gold prices rose for a fifth straight session and touched a 7-year high while the U.S. 30-year Treasury bond yield set a record low. MSCI's global gauge of stocks was down 2.8%.
Despite the spike in coronavirus cases reported in Italy, South Korea and Iran, the head of the World Health Organization said that "using the word 'pandemic' now does not fit the facts but may certainly cause fear."
"We must focus on containment while preparing for a potential pandemic," Tedros Adhanom Ghebreyesus told reporters in Geneva, adding that the world was not witnessing an uncontained spread or large-scale deaths. over the hit to economic growth and uncertainty over the stress to supply chains triggered selling in stocks and other high-risk assets.
"It is not as though the numbers have changed dramatically; but what has changed is the geography, which adds a new level of concern," said Art Hogan, chief market strategist at National Securities in New York.
"What the market is trying to predict here is 'How large will this get globally, and when will it start to peak?'"
The Dow Jones Industrial Average .DJI fell 888.59 points, or 3.06%, to 28,103.82, the S&P 500 .SPX lost 96.94 points, or 2.90%, to 3,240.81 and the Nasdaq Composite .IXIC dropped 313.38 points, or 3.27%, to 9,263.21.
The pan-European FTSEurofirst 300 index .FTEU3 lost 3.76% with Milan's stock market down over 5% after a spike in cases of the virus left six dead in Italy and parts of the country's industrial north in virtual lockdown. .EU
MSCI's gauge of stocks across the globe .MIWD00000PUS shed 2.92%, its biggest single-day decline since June 24, 2016.
The virus has now killed more than 2,500 people in China, which has reported some 77,000 cases, and spread to 29 other countries and territories, with a death toll of more than two dozen outside of China, according to a Reuters tally. which announced its first infections last week, said it had confirmed 61 cases and 12 deaths, with most cases in the holy city of Qom. Kuwait, Bahrain, Oman, Afghanistan and Iraq reported their first new coronavirus cases, all in people who had been to Iran. idea that the coronavirus has been fully contained has been firmly banished," said Chris Beauchamp, chief market analyst at IG. "This means the economic forecasts of the impact, such as they are, will need to be revised, with a greater impact now to be expected."
SURGE TO SAFETY
U.S. fed fund futures 0#FF: signaled more rate cuts later this year and a near 20% chance of a cut next month.
In currency markets the Japanese yen strengthened 0.78% to 110.73 per dollar.
"Ultimately this is all a risk-off trade," said Marvin Loh, senior global markets strategist at State Street (NYSE: STT ) Global Markets.
"When you look at the yen, when you look at the Swissie , when you look at rates, it is risk-off. It's probably reflective, to a certain degree, of the market being a little too sanguine up until now ... so there's an adjustment process around it."
Korea's won KRW= was down 1% at 1,219.06 after falling to its weakest level since August 2019. Emerging-market currencies, from Mexico's peso MXN= and Turkey's lira TRY= to Poland's zloty PLN= and Russia's ruble RUB= , were all in the red.
Among the main industrial metals, Copper CMCU3 lost 1.33% to $5,688.50 a tonne. MET/L
"As the virus spreads globally, additional downside revisions in oil demand for this year may be required," Jim Ritterbusch, president of Ritterbusch and Associates, said in a note.
"The accelerated sell-off in the stock market has become difficult for the oil market to ignore," he said.
https://tmsnrt.rs/2zpUAr4 Asia-Pacific valuations
https://tmsnrt.rs/2Dr2BQA World FX rates in 2020
Add Chart to Comment
We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:
- Enrich the conversation
- Stay focused and on track. Only post material that’s relevant to the topic being discussed.
- Be respectful. Even negative opinions can be framed positively and diplomatically.
- Use standard writing style. Include punctuation and upper and lower cases.
- NOTE: Spam and/or promotional messages and links within a comment will be removed
- Avoid profanity, slander or personal attacks directed at an author or another user.
- Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
- Only English comments will be allowed.
Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.