Global shares plunge in worst day since financial crisis
On March 9, 2020, the United States experienced a 7.8% drop in stock indexes, the largest since the financial crisis. Numbers of other regions across Europe and Asia are also suffering similar to that of the United States’ Dow Jones average drop of over 2,000 points. In both the US and European regions, oil markets led to the decline in Stock Indexes. Large market share companies such as Shell, BP, and Chevron are down approximately 15% or more. Previously, declines such as these sparked international travel and dramatic increases in spending. However, scares of contracting the Coronavirus prevented potential heightened travel.
Current disputes between Saudia Arabia and Russia are responsible for the deterioration of oil share values despite spiked drops caused by the Coronavirus. Saudia Arabia retaliates after Russia rejected a proposal to cut supply in an attempt to match lower demand caused by the Coronavirus. Russia pronounced that they would continue with production as is. Consequently Saudia Arabia, in retaliation, decided to outproduce Russia and significantly decrease oil market values in hopes Russia would reconsider their proposal. Investors are in extreme uncertainty about the status of their long-term investments because it is unknown when the conflict between Russia and Saudia Arabia will be resolved. Conversely, those who do not have direct investments are not properly concerned as the fluctuations in investments directly affect their pension.