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* BP, Shell plunge over 14%; on track for worst day ever
* FTSE 100 drops 5.8%, FTSE 250 down 4.9%
* Autos, miners, oil & gas stocks lead declines
(Adds comments, details; updates prices)
By Shivani Kumaresan and Devik Jain
March 9 (Reuters) - London's FTSE 100 plunged to a
three-year low on Monday after oil majors slumped because of a
price war between Saudi Arabia and Russia that sent crude
crashing about 25%, with investors also alarmed about the
economic fallout of the coronavirus outbreak.
Oil majors BP Plc and Royal Dutch Shell Plc
were on track to record their worst day ever, as Saudi Arabia
slashed its official crude selling price following Russia's
refusal to cut output to match lower demand on the back of the
health crisis.
The wider oil and gas sector tanked 16% and was
on track for its biggest one-day percentage fall on record.
The commodity-heavy FTSE 100 gave up 5.8% and was on
course for its worst day since the global financial crisis in
2008, while the domestically focussed mid-cap index shed
4.9%.
All stocks listed on the FTSE 100 were in the red, with auto
parts, banks, mining and
travel and leisure stocks among the biggest
decliners.
"It's been several days since the coronavirus really took
hold of markets and this feels like almost a different thing
entirely just because of how severe it is once again, raising
the spectre of the financial crisis," said Connor Campbell,
analyst at financial spread better Spreadex.
European firms have lost nearly $3 trillion in value since
fears of the economic damage from the epidemic sparked a
worldwide sell-off last month, with the equity market now firmly
in bear market territory, implying a 20% drop from all-time
highs.
Fears of a global recession have also been amplified by a
reduction in global growth forecasts as the unchecked spread of
the virus prompted harsher containment measures and crippled
supply chains.
Prime Minister Boris Johnson is set to chair the
government's emergency committee meeting on Monday to discuss
further measures to contain the virus, which has so far infected
273 people and killed three in Britain.
Central banks around the world have taken measures to inject
more cash into financial markets, with traders now expecting the
U.S. Federal Reserve to cut rates again on March 18 after an
emergency reduction last week.
All eyes are now on the European Central Bank meeting on
Thursday, but analysts have questioned the efficacy of monetary
policy easing to revive supply chains.
"Monetary and fiscal policy will be of limited effect until
prices more broadly reflect a very high probability of
recession," said Bill Zox, chief investment officer for fixed
income at Diamond Hill Capital Management.
(Additional reporting by Kate Duguid; Editing by Bernard Orr
and Sagarika Jaisinghani)
