US President Donald Trump’s administration is under pressure amid coronavirus-driven recession fears as stock markets rattled and health officials issued more warnings.
Wall Street on Monday suffered its biggest one-day loss since the 2008 financial crisis, the Dow fell a record 2,000 points and the S&P 500 posted its largest single-day percentage drop since 2008.
A plunge in oil prices has contributed to fears of a looming coronavirus-led recession after Saudi Arabia cut its export oil prices in what is likely to be the start of a price war aimed at Russia. Riyadh’s decision threatens to overwhelm global oil markets with a supply surplus. Oil prices fell 20% in their deepest daily decline since the 1991 Gulf War.
Trump has repeatedly downplayed the threat posed by the coronavirus outbreak despite growing signs that the epidemic was disrupting the economy and the lives of millions of Americans.
Investors and analysts have warned that the economic fallout could threaten Trump’s re-election bid in November, Reuters said.
“President Trump’s reelection likely hinges on the economy — a medical and/or economic shock from coronavirus (COVID-19) are arguably the biggest threats to Trump’s re-election,” American financial services company Raymond James said.
The US confirmed at least 728 coronavirus cases and 26 deaths as of early Tuesday morning. Thirty four states, chief among them California and New York, as well as the District of Columbia have reported infections of COVID-19.
House Speaker Nancy Pelosi, the top Democrat in Congress, said the US market plunge suggested investors lacked confidence in the Trump administration’s plan to combat the coronavirus.
“If we go into recession, history speaks for itself. No sitting president has ever been re-elected in a recession, “said Peter Cardillo, chief market economist for Spartan Capital Securities.
The White House is facing harsh criticism that it initially bungled its response to the coronavirus outbreak and under-funded the containment efforts.