Worst week since 2008 global financial crisis as global indices nosedive

Most global markets have suffered their worst weekly setback since the 2008 global financial crisis, as the coronavirus outbreak triggered a flight to safety among investors. While equity markets have tumbled, bond markets have rallied with the yield on the US treasury dropping below 1.2 per cent, lowest since 2016. 

The velocity of the fall in stocks has been sharp across markets in Asia, Europe, and America. 

The S&P500 index has made a record of entering a correction zone — a fall of over 10 per cent —in the shortest time frame of just six trading sessions. Indian markets, too, are close to entering correction territory. 

On previous occasions in the past two years, domestic markets have rebounded sharply after such a fall. Whether the market will be able to bounce back this time as well will depend on whether the coronavirus spread is contained.