We are going to close down this blog after another historic day for global business and markets. Here are some of the main developments:

• The FTSE 100 recorded its second best day on record, with shares surging by 9.05%, the largest percentage gain ever barring 24 November 2008. The FTSE 250 enjoyed a record gain of 8.37%.
• Wall Street also enjoyed big gains, as investors looked forward to a stimulus deal passing US Congress. The S&P 500 had gained 7% at the time of writing.
• G7 finance ministers and central bankers pledged to do “whatever is necessary” to help their economies recover from the coronavirus.
• It came after a string of dire warnings of global recession from closely followed surveys of businesses in the US, UK, eurozone and Japan.
  

For more coverage of the global coronavirus outbreak you can visit our live blogs from around the world:

In the US, Trump says he would love to have the country open by April 12th

In the UK, 12,000 NHS workers are set to come out of retirement to battle the outbreak

And in our global coverage, India has announced a 21-day lockdown for 1.4bn people

Thanks for reading today, as ever - and join Graeme Wearden again tomorrow morning for more live coverage of markets, economics and business. JJ

The late rally on the FTSE 100 has given it the strongest gain since 2008, the last time the world was threatened by a global recession.

If confirmed in the closing auction today’s 7.48% gain on London’s blue chip index would be the biggest since 24 November 2008.

Aside from 2008 the only time it has risen more was 1987, in the aftermath of Black Monday.

Germany’s Dax gained 10.1%, its biggest gain since 2008 and France’s Cac 40 gained 7.6%. The Europe-wide Stoxx 600 gained 7.5%, its biggest gain since 2008.

EDF Energy plans to cut the 4,000-strong workforce at the Hinkley Point C nuclear construction site by more than half after an outcry over plans to continue construction despite national efforts to stem the spread of the coronavirus.

The company said it would scale back the number of worker on Britain’s biggest construction site to less than 2,000 over the coming days after the prime minister told Britons they “must stay at home” through a 21-day lockdown.

The project will keep only skilled workers required for its specialist nuclear supply chain and focus on critical work on nuclear-specific parts of the project.

It will also introduce split shifts, extra buses and staggered breaks to allow for easier social distancing.

EDF Energy’s decision follows a report from the Guardian which revealed concerns over the close proximity of workers from across the country who have no choice but to use shared onsite accommodation and transit buses to access the site.

EDF Energy’s initial plan included increasing the number of buses to help staff maintain two metres of space between them, as well as banning handshakes.

The slowdown is likely to reignite concerns over the project’s costs. EDF Energy said last year that difficult ground conditions on the site meant that costs for the first new nuclear reactor in a generation had climbed by between £1.9bn to £2.9bn from the company’s last estimates to around £22bn.

Andrew Hunter of Capital Economics says today’s grim survey of US purchasing managers shows America is heading towards a severe contraction in the next few months.

On past form, the composite PMI is consistent with GDP contracting at a 5% annualised pace, which would be one of the biggest quarterly declines on record. But with the virus continuing to spread rapidly and the lockdowns already in place across parts of the country only likely to be extended, we now suspect that the second-quarter hit will be substantially larger than that.

This further underlines the need for a major fiscal stimulus, if only to help underpin an eventual recovery when the virus is brought under control.

Economist Adam Wolfe of Absolute Strategy Research agree that the slump in US and Europe is just beginning, given the contraction seen in China already:

NEWSFLASH: America’s private sector is shrinking at the fastest rate since at least the financial crisis in 2008.

The latest survey of US purchasing managers, from IHS Markit, shows that activity in the U.S. services and manufacturing sectors contracted sharply in March.

This dragged Markit’s Flash US composite output index down to 40.5 (from 49.6 in February) the lowest since the survey was created in October 2009. Any reading below 50 shows a contraction.

US companies reported that new business fell, including new exports, as clients responded to the Covid-19 outbreak.

Service sector shrank at a record pace (again, since 2009), while factories had the worst month since the financial crisis over a decade ago.

This largely mirrors the slump seen in the UK, the eurozone, and Japan earlier today:

Chris Williamson, chief business economist at IHS Markit, fears America is sliding into recession:

“US companies reported the steepest downturn since 2009 in March as measures to limit the COVID-19 outbreak hit businesses across the country.

The service sector has been especially badly affected, with consumer-facing industries such as restaurants, bars and hotels bearing the brunt of the social distancing measures, while travel and tourism has been decimated. However, manufacturing is also reporting a slump in demand, with production falling at a rate not seen since 2009, linked to either weak client demand, lost exports or supply shortages.

“Jobs are already being slashed at a pace not witnessed since the global financial crisis in 2009 as firms either close or reduce capacity amid widespread cost-cutting.

“The survey underscores how the US is likely already in a recession that will inevitably deepen further. The March PMI is roughly indicative of GDP falling at an annualised rate approaching 5%, but the increasing number of virus-fighting lockdowns and closures mean the second quarter will likely see a far steeper rate of decline.

Stocks have jumped in New York at the start of trading, on hopes that US politicians could finally agree a stimulus package to combat the economic cost of Covid-19.

The Dow Jones surged by over 1,100 points, bouncing back from its lowest levels since January 2017. The other indices are also up over 5% too.

The rally was sparked by signs that the White House and the Democratic party are - finally - close to agreeing a package of aid measures.

My colleague Ed Helmore explains:

Senate minority leader Chuck Schumer and US treasury secretary Steven Mnuchin appeared on Tuesday morning to be close to a deal over a coronavirus stimulus bill, even as Donald Trump signaled his wish to reopen the economy and continued to attack House speaker Nancy Pelosi over her own stimulus proposal.

“I think we’ve made a lot of progress,” Mnuchin told reporters on Capitol Hill, just before midnight on Monday. “There’s still a couple of open issues, but I think we’re very hopeful that this can be closed out [on Tuesday].”

Mnuchin said he and Schumer had consulted with the president and Senate majority leader Mitch McConnell on the details of the deal, which is believed to secure around $2tn in aid for workers and businesses.

“We expect to have an agreement tomorrow morning,” Schumer said. “There’s still a few little differences. Neither of us think they’re in any way going to get in the way of a final agreement.”

He also added that Trump seemed “very positive” about the talks.

NEWSFLASH: We’re moving towards the ‘whatever it takes moment’ in the Covid-19 crisis.
The world’s most powerful finance ministers and central bankers have just issued a joint statement, pledging to take the necessary steps to address the coronavirus crisis.

They say:

We will do whatever is necessary to restore confidence and econonomic growth, and to protect jobs, businesses and the resilience of the financial system.

Significantly, the G7 says they are committed to “deliver the fiscal effort necessary” to help economies recover rapidly from the current shock, and resume their path towards “stronger and more sustainable economic growth”.

That, they say, will include expanding health systems, and taking liquitity support and fiscal expansion (ie government spending) to negate the negative impact of Covid-19

The finance chiefs also insist they are sharing ideas and experiences as they try to tackle the worst recession in decades:

We are cooperating closely to share experiences and strategies so that we may effectively target our efforts to support our citizens and businesses. We are instituting new policies such as providing assistance for employment, telework, and vulnerable populations, and expanding access to childcare and unemployment benefits.

We are also providing liquidity enhancements, guarantees, subsidized loans, tax deferrals, and loan repayment deferrals and, where appropriate, grants for affected companies, especially small and medium-sized businesses.

The finance ministers also pledge to “promote global trade and investment”, and to “coordinate on a weekly basis” as they implement these measures and take “further timely and effective actions”.

Encouraging. There’s no new commitment for exactly how much governments will spend. But, as a reader points out, you can’t put a price tag on ‘whatever’s necessary’ :)

The global airlines body, Iata, has now said that the industry will lose $252bn in revenues this year – more than double its forecast “worst case scenario” from earlier this month as the coronavirus crisis has grown.

Iata said European airlines were the most likely to collapse, following earlier warnings that most carriers worldwide would be bankrupt by May. Countries that cover 98% of commercial air passenger revenues now have restricted travel. Director general Alexandre de Juniac called for government aid to airlines “with maximum speed”.

We are in an emergency situation – we need a full-speed, massive rescue package now.”

Right, time for a quick summary after another busy morning

Britain’s economy is heading into a deep recession, according to the latest survey of UK purchasing managers. Service sector activity is slumping at a record rate as customer-facing firms shut down, while manufacturers are also suffering from weak demand.

Markit, which compiles the report, fears the recession could be on a scale ‘not seen in modern history’.

The Eurozone PMIs were equally weak, suggesting the region is also falling into contraction. Both France and Germany’s service sectors are weakening at a faster rate than after the 2008 crisis, or the debt crisis.

Construction firms are being hit too - with Taylor Wimpey halting work at its building sites today, and London’s Crossrail project being suspended a few minutes ago.

Many UK shops are now shut, with the government rejecting Sports Direct’s claim to be an essential service.

Supermarkets are facing unprecedented pressures - with Waitrose now limiting the number of people allowed in stores, and Sainsbury keeping its Argos outlets open.

Nationwide is cutting opening hours, as banks and building societies come to terms with new ‘physical distancing’ rules.

Ryanair is asking passengers to be patient, as it struggles with compensation claims after grounding most of its planes.

The Bank of England has predicted that UK banks are strong enough to cope with the Covid-19.....and defended asking some staff to attend work in person.

Despite the looming recession, the markets are more buoyant today.

• FTSE 100: up 200 points or 4% at 5194
• Sterling: up 1.3% at $1.17 vs the US dollar; up 0.3% at €1.0805 vs the euro
• Brent crude: up 2.75% at $27.87 per barrel

Here’s my colleague Richard Partington on today’s dire PMI reports:

The scale of the global economic damage amid the coronavirus outbreak is becoming clearer after early warning signs showed the steepest plunge in business activity ever recorded in Britain, Japan and the eurozone.

As the pandemic intensifies and more countries shut down large parts of their economies to contain the spread of the virus, the closely-watched purchasing managers indices (PMI) for several of the world’s biggest economies fell to the lowest levels since records began more than two decades ago.

With the world sinking into a deep recession, the UK flash PMI for the service sector – which includes restaurants, hotels and banks and accounts for about 80% of the UK economy – crashed to 35.7 on an index where anything above 50.0 separates growth from contraction.

The collapse on the index, which is closely monitored by the Treasury and the Bank of England, outstripped the slump recorded during the depths of the 2008 financial crisis, as emergency public health measures disrupt supply chains and demand for goods and services evaporates.

Ryanair boss Michael O’Leary has asked customers for patience with the processing of refunds or rebooking, in the midst of some passenger disgruntlement with the carrier’s response to the coronavirus.

O’Leary said that Ryanair had reduced its office staff by 50% “for social distancing reasons” and was struggling to deal with anything but the most urgent cases and rescue flights. He urged customers not to call, and they would be emailed in the next fortnight.

However, the consumer association Which? said that Ryanair was leaving customers stranded, especially in Spain. It warned passengers abroad not to accept refunds from airlines if they needed to get home, as it would mean they were no longer responsible for rerouting them onto alternative flights.

The Irish carrier, which has not over the years built a store of goodwill from customers, expects virtually all flights to be grounded from today. O’Leary said it had offered its aircraft to EU governments for rescue flights and for the movement of vital medicines and supplies.

O’Leary added that “this crisis will pass” and the airline was doing everything to keep its planes and crew operational and ready to return to flying when Europe is clear of the pandemic.

The Bank of England believes UK banks are strong enough to survive the coronavirus outbreak, despite forecasting a “more severe” short-term impact than its annual stress tests have been able to simulate.

In the minutes of its latest meeting, released this morning, the Financial Policy Committee said:

The FPC considered that the economic disruption associated with Covid-19 should have less impact on the core banking system than recent stress tests run by the Bank have shown the system can withstand.

It added:

The disruption from Covid-19 would likely be more severe than the stress test in the first phase but the FPC expected that it would ultimately be less protracted and lead to less output loss overall over the course of two years than the ACS [or annual cyclical scenario] which contained a very prolonged fall in output.

That should be reassuring, given that the bank’s most recent stress tests involved a 4.7% fall in UK GDP, a rise in unemployment to 9.2%, a 33% drop in house prices, an increase in interest rates to 4% and a near-30% drop in the value of the pound versus the US dollar.

UK housebuilders are also reeling from the crisis.

Taylor Wimpey, one of the UK’s biggest house builders, has just announced it is closing all its construction sites, show homes and sales centres.

It has axed its 2020 final dividend worth £125m and a planned special dividend worth £360m, and like other companies, is unable to give any financial guidance. It has moved its annual meting on 23 April to its head office in High Wycombe and will provide a dial-in to shareholders.

Rival housebuilder Redrow scrapped its dividend payment to shareholders due on 9 April, worth £37m, and said:

“As the government’s escalating measures to contain the spread of the virus take effect, it is inevitable our sales rate will be seriously impaired over the coming weeks and build output will be significantly affected by labour and material shortages.

We also expect outlet openings to slip as local authorities delay planning committee meetings.”

NEWSFLASH: The UK economy is contracting at its fastest rate in at least two decades, as the service sector is hit extremely hard by the Covid-19 outbreak.

Data firm Markit reports that business activity across services and manufacturing has slumped this month, as the coronavirus deals the UK economy “a more severe blow than at any time since comparable figures were first available over 20 years ago”.

Output has slumped, new orders have contracted at their fastest pace since 2008, and business expectations have absolutely cratered.

This has dragged Markit’s survey of UK purchasing managers down to just 37.1 in March, down from 53.0 in February. That shows an extremely sharp fall in activity.

It’s the worst reading since the survey began in 1998, and means the economy is contracting much faster than after the collapse of Lehman Brothers in 2008.

Such a low number suggests a deep recession is inevitable this year (understandably, with so many businesses now closed due to coronavirus measures).

The services sector PMI (which covered much of the UK economy) slumped to just 35.7, from 53.2 in February.

The manufacturing PMI fell to 48.0 from 51.7 (but the true picture is worse, as the PMI calculation assumes that long delays for supplies are a sign of a strong economy)

Chris Williamson, Chief Business Economist at IHS Markit, says a recession ‘not seen in modern history’ is now likely:

“The surveys highlight how the COVID-19 outbreak has already dealt the UK economy an initial blow even greater than that seen at the height of the global financial crisis.

With additional measures to contain the spread of the virus set to further paralyse large parts of the economy in coming months, such as business closures and potential lockdowns, a recession of a scale we have not seen in modern history is looking increasingly likely.

“Historical comparisons indicate that the March survey reading is consistent with GDP falling at a quarterly rate of 1.5-2.0%, a decline which is sufficiently large to push the economy into a contraction in the first quarter. However, this decline will likely be the tip of the iceberg and dwarfed by what we will see in the second quarter as further virus containment measures take their toll and the downturn escalates.

“Any growth was confined to small pockets of the economy such as food manufacturing, pharmaceuticals and healthcare. Demand elsewhere has collapsed, both for goods and services, as increasing numbers of households and businesses at home and abroad close their doors.

NEWSFLASH: Eurozone economic output is slumping this month, at a rate that far exceeds the worst moments of the financial crisis or the euro debt crisis.

Data firm Markit’s monthly survey of purchasing managers, just released, has crashed to its lowest level since it was created in 1998 -- at just 31.4.

That’s a dramatic slump from February’s 51.6 -- showing “an unprecedented collapse in business activity” (echoing what we’ve already heard from France and Germany) [reminder: anything below 50 = contraction].

Europe’s services sector was especially hard hit, especially consumer-facing industries such as travel, tourism and restaurants. But factories are also shrinking sharply, due to weak demand and restrictions on workers’ travel.

• Flash Eurozone Services PMI Activity Index(2) at 28.4 (52.6 in February). Record low (since July 1998).
• Flash Eurozone Manufacturing PMI Output Index(4) at 39.5 (48.7 in February). 131-month low.
• Flash Eurozone Manufacturing PMI (3) at 44.8 (49.2 in February). 92-month low

Eurozone bosses are also extremely gloomy about the future, and slashing their workforces in response. Markit says:

Expectations of future output also deteriorated markedly to reach an all-time low, with record degrees of pessimism about the year ahead seen in both manufacturing and services.

The unprecedented slumps in demand and business sentiment prompted the largest monthly cull in staffing levels since July 2009.

Germany’s service sector has also contracted extremely sharply this month.

Data firm Markit reports that its flash Germany Services PMI Activity Index has slumped to just 34.5, from 52.5 in February - a record low.

Factory output also contracted again, with the manufacturing PMI sliding to 45.7 from 48.0 (further away from the 50-point mark showing stagnation).

Phil Smith, Principal Economist at IHS Markit, says Germany is heading for a deep recession:

“The unprecedented collapse in the PMI underscores how Germany is headed for recession, and a steep one at that. The March data are indicative of GDP falling at a quarterly rate of around 2%, and the escalation of measures to contain the virus outbreak mean we should be braced for the downturn to further intensify in the second quarter.

The service sector has so far borne the brunt of the government’s measures to stem the spread of COVID-19, with activity falling to the greatest extent in almost 23 years of data collection, and at a rate that already far surpasses anything seen even during the depths of the global financial crisis.

Smith also warns that the manufacturing sector is probably worse than today’s report suggests -- because long delivery times and low stock levels boost the PMI (because they typically show a strong economy).

Good grief! France’s economy is shrinking at an alarmingly fast rate, as the coronavirus outbreak hurts businesses badly.

The latest survey of French purchasing managers shows that activity shrank at a record pace in March (the survey goes back to the late 1990s).

Overall new orders placed with French businesses fell at the fastest pace in the series history too, with services firms particularly badly hit. This forced firms cut their staff numbers for the first time in nearly three and-a-half years, at the fastest rate since April 2013

This dragged the Flash France Composite Output Index down to just 30.2 in March, from 51.9 in February - a record low. Anything below 50 shows a contraction.

The service sector was particularly badly hit too:

• Flash France Services Activity Index at 29.0 in March (52.6 in February), series low
• Flash France Manufacturing Output Index at 35.6 in March (49.0 in February), 132-month low
• Flash France Manufacturing PMI at 42.9 in March (49.7 in February), 86-month low

It’s an extremely worrying sign for France’s economy, and the wider economy.

It appears that Sports Direct has been forced to abandon its attempt to defy the government’s lockdown, and keep its stores open.

Cabinet Office minister Michael Gove just told the BBC Today Programme that the government has made it clear that this decision was wrong.

Management have got the message, and Sports Direct stores will not be open, he insisted.

Clearly the government wasn’t convinced by SPD’s argument that the public needed to nip to the high street to buy home gym equipment....

In a welcome relief to investors, Britain’s stock market is rebounding from Monday’s rout.

The blue-chip FTSE 100 has jumped by almost 4% in early trading, up 199 points at 5190 (last night it closed at its lowest point since 2011).

The London Stock Exchange itself is the top riser (+10%), followed by life insurance and financial services group Prudential (8.3%), and cruise operator Carnival (9%) (whose cruises are currently mothballed).

The FTSE 250 index of mid-sized companies has also bounced, up nearly 3% at 13,504.

Ipek Ozkardeskaya, senior analyst at Swissquote Bank, warns that the markets are pinning their hopes on a US stimulus deal -- where there’s still conflict on Capitol Hill.

Investors have their hopes tied to the $2-trillion rescue package that needs to get signed by the Congress, yet apparently there are controversies among policymakers on how to spend this money.

House Speaker Nancy Pelosi says the help is destined to corporations first, not workers and their families. While spending on climate change related issues are said to pull politicians apart and prevent the deal from getting signed. Yet a delayed deal is damaging for both parties, especially now that the coronavirus-induced lockdowns accelerate across the United States as well.

Japan’s economy has suffered a slump in activity this month, according to the latest purchasing managers survey.

Activity at Japanese services sectors shrank at the fastest pace since at least 2007 in March, while factories contracted at the fastest rate since the aftermath of Lehman Brothers’ collapse.

It’s a clear sign that Japan’s economy is weakening fast, and of course they’re not alone!

Reuters has the details:

The au Jibun Bank Flash Japan Manufacturing Purchasing Managers’ Index (PMI) fell to a seasonally adjusted 44.8 from a final 47.8 in February, its lowest since April 2009.

The au Jibun Bank Flash Japan Services PMI index slumped to a seasonally adjusted 32.7 from the previous month’s 46.8, its lowest since the start of the services sector survey in September 2007.

Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.

With Britain now in lockdown, we’re about to learn how badly the coronavirus has hurt the UK economy. And it’s going to be grim.

A new survey of purchasing managers at service sector firms and factories across the country is going to show just how badly exports and output have fallen this month, and how many firms have slashed jobs.

These PMI surveys are designed to give a really up-to-date healthcheck on what’s happening in the economy right now. But of course, we already know that self-isolation measures to slow Covid-19 are having a chilling impact on growth.

So the UK ‘composite PMI’, which covers much of the economy, is certain to tumble into contraction territory (below 50 points).

The eurozone PMIs are likely to show an even more painful contraction, as lockdowns in Italy, France, Spain and Germany have already hurt businesses badly.

With factories and services firms in Asia also badly hit by Covid-19, and American cities now enforcing lockdowns, a global recession in 2020 looks inevitable.

Last night, the International Monetary Fund warned that it could be worse than 2008.

IMF Kristalina Georgieva said:

First, the global economic outlook for 2020 is expected to be negative. We will face recession at least as bad as during the global financial crisis or worse, but we expect recovery in 2021.

Also coming up today

Global stock markets are expected to rebound today, after slumping yesterday.

Investors have had time to digest the latest extraordinary action from the US Federal Reserve (unlimited money printing until morale improves), and are still hoping American politicians will agree a stimulus package.

Non-essential UK retailers will be shutting their doors today - it’s your last chance to buy a meaty, or vegany, treat from Greggs, or a new outfit from

But essential services will continue to operate..... which (believe it or not) Sports Direct believes it qualifies for as a ‘sports and fitness retailer’.

WH Smith is also “positioning itself to government as an essential retailer”, as it sells newspapers and magazines.

We’ll keep an eye on whether these arguments holds water through the day....

The agenda

• 9am GMT: Eurozone composite ‘flash’ PMI for March: expected to slump from 51.6 to 38.8
• 9.30am GMT: UK composite ‘flash’ PMI for March: expected to slump to 45.1 from 53.0
• 1.45pm GMT: US composite ‘flash’ PMI for March
• 2pm GMT: US New Home sales for February