American stock markets declined by nearly five per cent on Wednesday evening (local time) after President Donald Trump announced that travel from Europe to the United States will be suspended for 30 days, beginning Friday at midnight.
Dow (INDU) futures plunged more than 1,100 points or 4.73 per cent, S & P 500 (SPX) futures fell 4.6 per cent and Nasdaq (COMP) futures were down 5 per cent, CNN reported.
The suspension does not include the United Kingdom. Trump made the announcement during an address to the nation about the novel coronavirus outbreak, which has surpassed 115,000 cases worldwide. More than 4,000 people have died.
He later clarified on Twitter that "trade will in no way be affected" by the travel restriction.
"Hoping to get the payroll tax cut approved by both Republicans and Democrats, and please remember, very important for all countries and businesses to know that trade will in no way be affected by the 30-day restriction on travel from Europe. The restriction stops people not goods," the President tweeted.
Markets in Asia were all trading sharply lower Thursday morning. Japan's Nikkei 225 (N225) fell 4.1 per cent. The benchmark index is on pace to enter into a bear market, defined as a drop of more than 20 per cent from the most recent high.
Hong Kong's Hang Seng Index (HSI) was down 3.2 per cent, while the Shanghai Composite Index (SHCOMP) fell 1 per cent and South Korea's Kospi Index (KOSPI) was down 3.8 per cent.
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The declines followed another volatile day on Wall Street in a roller coaster week for the markets driven by the novel coronavirus outbreak and plummeting oil prices.
Both the S & P 500 and the Dow slipped into a bear market territory, but only the Dow closed the day in a bear market.
Two other key market indexes, the Dow Jones Transportation Average (DJT) and the small-cap focused Russell 2000 (RUT), are already in a bear market.
The World Health Organization has also officially announced the viral infection to be a global pandemic. There are 118,000 cases, more than 4,000 deaths, the agency said, and the virus has found a foothold on every continent except for Antarctica.