London shares were deep in the red today, after two days of gains, as data confirmed the world is in a deep recession.
Traders reacted to a awful US jobless claims number which came in at 3.3 million - the worst in history.
Analysts had pencilled in anything from 1 million to 4 million claims, a massive spike from last week when the figure was 281,000.
The magnitude of claims show how extensive the damage to the US economy has been from coronavirus as businesses lay off workers to reduce costs.
One broker said: “Make no mistake, this is the big event of the day and has damaged sentiment across the globe. This is the start of awful data and will show what a big a hole the world economy is in.”
The UK has its own unemployment problems and early government figures show that applications for universal credit have been up by over half a million in the last nine days.
As a result the FTSE 100 was down 114.11 points at 5574.09 with banks hardest hit, amid fears they could be most damaged by a recession.
Royal Bank of Scotland was off 5% or 6.7p at 124p after Ian Gordon, analyst at Investec, said he could think of no reason for buying the stock. Gordon believes RBS - which is still 62.4% owned by the taxpayer - will be lossmaking in 2020 and that there will be no dividend.
Gordon said: “Any notion of a near-term Government sell down appears redundant, in 2020 we now expect RBS to be loss-making and to pause the dividend. It is now for the birds.”
HSBC was also in the red for a second day in a row amid worries that there could be a second wave of coronavirus cases in Asia with Japan's capital Tokyo and Hong Kong bracing themselves. Shares were down 4% or 24p at 485p.
Further down the league table and there were some bright spots, including engineering firm Babcock which said it had joined the fight to build ventilators. It comes as yesterday the government ordered 10,000 ventilators from vacuum cleaner-maker Dyson.
Health Secretary Matt Hancock says the NHS needs 30,000 of the ventilators within months to treat coronavirus patients. Babcock shares rose 4p at 375p.
But there were worrying signs for the media industry after Daily Mirror and Daily Express owner Reach said advertising revenue and print circulation would be damaged by coronavirus. Reach sought to calm investors, adding that the company has a robust balance sheet and recently signed a new 4 year revolving banking facility of £65 million.
Boldly it also said there are no plans to follow the lead of some other companies and bin the recently announced full-year dividend. Shares were down 3p at 94p.