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Global markets slump after 500 Chinese prisoners, Guards contact Coronavirus

By News Desk

U.S. stock indexes fell on Friday with investors scrambling for gold, which jumped to its highest in seven years, after atleast 500 prisoners and guards in four prisons in three provinces including Hubei, Wuhan where the virus first emerged in December.

The Chinese Government argued that the virus spread to several prisons contributing to a jump in reported cases beyond the epicentre in Hubei province, including 100 more in South Korea.

Though provincial officials did not say when they had been diagnosed but a total of 234 infections among Chinese prisoners outside Hubei ended 16 straight days of declines in new mainland cases.

Communist Party rulers stressed that the outbreak had not yet peaked, and more than 30 cases in a hospital in Beijing highlighted a sharp jump in the tally there.

Total cases in the Chinese capital of the coronavirus – known as COVID-19 – were at 396 with four deaths, out of an official mainland toll of 75,400 cases and 2,236 deaths.

U.S. activity in both the manufacturing and services sectors stalled as companies have grown increasingly concerned about the coronavirus, a survey of purchasing managers showed Friday.

The IHS Markit flash services sector Purchasing Managers’ Index dropped to 49.4 this month, the lowest since October 2013 and signalling that a sector accounting for roughly two-thirds of the U.S. economy was in contraction for the first time since 2016.

Data also showed Japan’s factory activity suffered its steepest contraction in seven years in February, underlining the risk of a recession there as the impact of the outbreak spreads. Asian and European stocks also fell.

With finance leaders from the Group of 20 major economies set to discuss risks to the world economy in Saudi Arabia at the weekend, the International Monetary Fund said it was too early to tell what impact the virus would have on global growth.

But the outbreak may curb demand for oil in China and other Asian countries, depressing prices to as low as $57 a barrel and clouding growth prospects across the Middle East, the Institute of International Finance said.

The World Health Organization (WHO), had warned that the window of opportunity to contain the international spread of the epidemic was closing after cases were reported in Iran and Lebanon.

The virus has emerged in 26 countries and territories outside mainland China, killing 11 people, according to earlier reports on the virus activities.

“This outbreak could go in any direction,” WHO chief Tedros Adhanom Ghebreyesus said in Geneva. “If we do well, we can avert any serious crisis, but if we squander the opportunity then we will have a serious problem on our hands.”

Chinese Vice Science and Technology Minister, Xu Nanping, said China’s earliest vaccine would be submitted for clinical trials around late April. That timetable is in line with research in other countries, and a WHO estimate of a vaccine reaching the market in about 18 months.

As international authorities seek to stop the virus from becoming a global pandemic, public health officials are hoping for signs that the arrival of warmer weather in the northern hemisphere might slow its spread.

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