NEW YORK (Reuters) - Global equity markets headed toward their first monthly loss since August on Friday as growing concerns about the economic impact of the coronavirus outbreak in China sapped risk appetite and lifted the safe-haven Japanese yen and Swiss franc.
Gold headed to its best month in five, while yields on U.S. and euro zone government debt fell to three-month lows as the United States, Japan and other countries tightened travel curbs to China, where the death toll from the virus rose to 213.
Crude prices fell, with Brent poised for its biggest monthly decline since November 2018, as supply chains disruptions and travel curbs look to crimp Chinese growth, leading economists to temper their outlook for the world’s second-largest economy.
Citigroup revised its full-year forecast for China’s GDP growth to 5.5% in 2020 from 5.8%. The bank also cut first-quarter growth expectations to 4.8% from 6% in the fourth quarter of 2019.
JPMorgan shaved its forecast for global growth by 0.3 percentage point for this quarter.
Equity markets tumbled more than 1% as disappointing U.S. and European data pointed to economic weakness and a mixed batch of corporate earnings added to the gloom.
U.S. consumer spending rose steadily in December, the Commerce Department said, but tepid income gains pointed to moderate consumption growth this year.
The Chicago Purchasing Management index fell to a lower-than-expected 42.9, the lowest since December 2015, as new orders and production tumbled and producers forecast tepid activity in 2020.
“The Chicago PMI was very weak,” said Tim Ghriskey, chief investment strategist at Inverness Counsel in New York.
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