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European stocks have crashed after U.S. President Donald Trump imposed a ban on travel from several countries in Europe. Travel volume has also plunged.
As the coronavirus continues to spread, several countries are increasing the measures they are taking to curb the infection. Many parts of China, where the virus first originated, are still on lockdown. Italy, which currently has the second-highest number of infections, has also imposed restrictions on several parts of the country. Confirmed cases in the United States are also increasing rapidly, causing President Donald Trump to initiate a travel ban on specific countries in Europe. The announcement has affected European stocks and even travel volume.
Trump Bans Travel from Europe
U.S. President Donald Trump has announced a ban on travel from European countries. The President says this is necessary to curb the spread of the virus as the number of confirmed cases continues to rise in the country.
As part of the announcement, Trump pointed fingers at Europe, saying that authorities could have done a lot more to prevent the worsening situation. According to him, many cases in the U.S. are linked to ‘travelers from Europe.’
Furthermore, the ban only affects all the 26 countries in the Schengen Area. These countries don’t check passports between their borders so entry among them is deliberately porous. The restriction does not affect non-Schengen countries including the U.K., Croatia, Bulgaria, Romania, and Cyprus. The ban will also not affect U.S. permanent residents.
Trump says the ban will begin at midnight on Friday and will last for 30 days. The announcement also suggests that the ban could be “adjusted subject to conditions on the ground.”
Europe Responds to the Trump Ban
Leaders in Europe have not yet officially responded. According to a tweet from European Council President Charles Michel, European authorities will discuss the ban and its implications today. He, however, said that Europe is doing everything it can to tackle the virus.
Following the travel ban @realDonaldTrump announced, we will assess the situation today.
— Charles Michel (@eucopresident) March 12, 2020
Trump previously clarified in a tweet that the ban will not affect trades between both regions. According to him, “the restriction stops people not goods.”
Stocks and Travel Plunge
The Trump announcement caused futures in the U.S. to fall noticeably. The Dow Jones Industrial Average (DIJA) lost over 600 points with other individual stocks also crumbling.
European stocks hit new three-year lows in response to the announcement. The Stoxx Europe 600 lost 6.4% specifically with airlines also plunging. Deutsche Lufthansa AG (ETR: LHA), for example, crashed 9%.
Travel is also seriously affected. For places where flights still run, several stories online have it that the airlines have dropped their prices. This was done probably because people are afraid and causing these airlines to lose business.
In the U.S. alone, there are currently over 1,200 confirmed cases. Worldwide, the virus has affected over 120,000 people and has killed over 4,300 people.