Italian stocks are set to plunge Monday morning as the euro zone’s third-largest economy grapples with the largest coronavirus outbreak outside of Asia.
European markets are set for sharp declines at the open as investors weigh up the extent of the coronavirus outbreak but not nearly as much as in Italy, where the FTSE MIB index is set to open 904 points lower at 23,835, according to IG.
There are widespread concerns over the spread of the virus in northern Italy; the country has now 152 confirmed cases and three deaths due to the virus, with a sharp spike in cases over the weekend.
The government has placed around a dozen towns in the north under quarantine with the wealthy regions of Lombardy and Veneto — where the cities of Milan and Venice are located respectively — the focus of the rise in coronavirus cases. The regions make up around 30% of Italy’s economic output, while the majority of the quarantined towns are just south of the financial hub of Milan.
Schools, museums, universities and cinemas have been closed while other public events, including Serie A soccer matches, have been canceled. Milan’s opera house, La Scala, canceled performances and while Giorgio Armani’s fashion show went ahead as part of Milan Fashion Week, no buyers or media were present.
Venice’s world-famous Carnival, which attracts thousands of visitors every year, was due to end on Tuesday but was cut short on Sunday as the government introduced “urgent measures” to contain the virus, including restricting access in and out of affected areas.
A woman wear a protective mask in Venice, Italy, on February 23, 2020 due to concerns over coronavirus infection. The carnival was suspended due to the coronavirus outbreak in northern Italy.
Meanwhile, concerns over the virus and quarantine measures have prompted panic-buying with Twitter users showing various supermarkets in the north with empty shelves. Italian newspaper Corriere della Sera reported Monday that latex gloves, hand disinfectant gel and bleach products were in short supply as inhabitants sought to protect themselves.
Italy’s authorities have scrambled to contain the spread of the virus but the head of the country’s Civil Protection Agency, Angelo Borrelli, conceded Sunday that it was still trying to find “patient zero,” the first carrier of the virus in the country.
“We still cannot identify patient zero, so it’s difficult to forecast possible new cases,” Borrelli told a press conference. The World Health Organization is sending a special mission to Italy to try to track down more details on the source of the infections.
Paolo Gentiloni, European commissioner for the economy and a former prime minister of Italy, told CNBC Sunday that “there is absolutely no reason for panic.”
“There is a reason to have confidence in institutions and Italian authorities. They know the situation. They are taking the good measures. So the European Union is perfectly confident on what the Italians are doing. But I repeat, there is no reason for panic.”