European markets closed lower on Wednesday, weighed down by fears over the damage caused to the global economy by the coronavirus pandemic.
The pan-European Stoxx 600 closed over 3% lower provisionally, with oil and gas stocks tumbling around 6% to lead losses on the back of falling crude prices, as all sectors and major bourses slid into negative territory.
Confidence among investors was further hit on Tuesday after the International Monetary Fund said the global economy in 2020 will likely suffer the worst financial crisis since the Great Depression this year, due to the impact of the Covid-19 pandemic.
The IMF now expects the global economy to contract by 3% in 2020. By contrast, in January it had forecast a global gross domestic product expansion of 3.3% for this year.
The U.S. said Tuesday that it will suspend funding to the World Health Organization while it reviews the agency's response to the Covid-19 pandemic, President Donald Trump announced Tuesday, saying the international health agency made mistakes that "caused so much death" as the coronavirus spread across the globe.
Global political and business leaders from United Nations Secretary General Antonio Guterres to Microsoft co-founder Bill Gates have hit out at the move. Guterres responded by calling for unity and solidarity, and said that now is not the time to reduce resources in the fight against the coronavirus.
U.S. equities also fell, with the Dow Jones Industrial Average sliding nearly 600 points amid a broad market sell-off.
There had been hopes in Europe that life could return to normal soon as various countries have started to tentatively lift restrictions on public life and businesses that have crippled economies during the pandemic.
Spain reopened some construction sites and manufacturing industries Monday, Italy has allowed some parts of the country to reopen bookshops and stationary shops, as well as shops selling children's clothes, on Tuesday. Denmark is due to reopen elementary schools and kindergartens on Wednesday.
Other countries, such as the U.K. and France, meanwhile, are looking to extend lockdown measures into early May.