Could the 2020 Cornonavirus Global Stock Market Sell-Off Trigger A Global Economic Recession?

It appears to be easing off but is it too early to write-off coronavirus triggering a global recession by the middle of 2020?

By: Ringo Bones

Could the COVID-19/ novel coronavirus 2019 trigger a global economic recession by the middle of 2020 due to the ongoing manufacturing shutdown of China – the world’s sole manufacturing center? Sadly, the FTSE 100 index closed 3.3-percent lower, its sharpest decline since January 2016. While in the United States, the Dow Jones and the S&P 500 experienced its sharpest daily decline since 2018 and the Milan stock market experienced a 6-percent drop on Monday, February 24, 2020 – all of this due to the fears that the ongoing novel coronavirus epidemic in Mainland China would still not be over during the start of the second economic quarter of 2020. But despite of the recent ease in the global stock market sell-off and a mad scramble for safe haven investments, could the high probability of a global economic recession by the middle of 2020 still be avoided?

Due to the still ongoing shutdown of factories in parts of China still severely affected by the COVID-19 epidemic, toy manufacturers in the United States and Europe already warns of a so-called “toy shortage” by the time of the 2020 Yuletide Season if China’s toy factories still don’t return to full steam production by the second quarter of 2020. The same situation applies too with other low-cost mass-market goods that have since been manufactured in China since the year 2000.