The crash came as a result of a dramatic fall in oil price as OPEC and its allies failed to agree a production cut over the weekend and demand reached a nine-year low after lack of factory activity and travel caused by the outbreak.
The S&P 500, the largest 500 stocks in the US, fell 7.6% on Monday, causing the New York Stock Exchange to trigger circuit breakers and bringing trading to a halt for 15 minutes. This was last seen in 2008 as investors panicked amid the Global Financial Crisis.
In London, the FTSE 100 fell 7.3% on Monday, wiping out roughly £150bn in a day.
Elsewhere, the Stoxx Europe 600, ASX 200 (Australia), Nikkei 225 (Japan) and the Hang Seng (Hong Kong) fell 7.4%, 6.7%, 5.2% and 4.3%, respectively.
The early stages of Tuesday morning have seen markets beginning to rebound as all indices, excluding the US which is yet to open, were positive.
S&P 500 (Black), FTSE 100 (Orange), Nikkei 225 (Blue), Hang Seng (Red), ASX 200 (Green) YTD performances – Source: Bloomberg
Nigel Green, CEO and founder of deVere Group, said: “Oil’s sharpest one-day drop since the 1991 Gulf war has further fuelled the sell-off in global stock markets that started a couple of weeks ago on fears that coronavirus is going to severely damage economic growth.
"With the combination of the implications of the oil stand-off and the outbreak, I now believe that it is almost inevitable that there will be a global recession this year.”