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Welcome to your morning markets update, delivered every weekday before the European open.

Good morning. European nations are cracking down on daily life to stem the virus’s spread, a U.S. rescue package hit a stumbling block and there’s more brutal forecasts of the illness’s economic impact. Here’s what’s moving markets.

Crackdown
European nations are tightening restrictions on citizens in latest attempts to stem the coronavirus’s spread. Germany — whose chancellor, Angela Merkel, has quarantined herself — banned gatherings of more than two people, while Spain moved to extend a state of emergency, Italy ordered a halt to domestic travel, and Greece will impose a national lockdown from 6 a.m. The U.K., deemed by some as having reacted slowly, said it could impose stricter measures after reports people were still gathering in parks and making trips to coastal towns.

U.S. Package Blocked
Over in the U.S., Senate Democrats blocked Majority Leader Mitch McConnell’s attempt to advance a coronavirus economic rescue package Sunday after leaders in both chambers disagreed on how to spend nearly $2 trillion. The vote puts in question McConnell’s plan for the Senate to pass the bill Monday. Republicans and Democrats differ on key sections of the plan, including a $500 billion chunk of the bill that could be used to help corporations, including airlines, or state and local governments.

Contraction Size
Europe’s largest economy could be headed for its biggest output contraction in more than a decade, with Germany’s finance ministry forecasting that the pandemic will see its economy shrink by at least 5% this year, according to people familiar with the figures. That compares with the current estimate of 1.1% growth. And there’s been some even more brutal economic estimates for the U.S. Goldman Sachs Group Inc. expects a 24% plunge in second quarter gross domestic product, while Morgan Stanley anticipates a 30% drop.

Stocks Slide
European and U.S. equity futures tumbled this morning along with Asian stocks as the global death toll from the pandemic continues to rise. Contracts in Europe fell more than 6%, while S&P 500 futures hit limit down and panic buying saw the dollar surge against emerging market currencies. Traders will continue to monitor infection rates, particularly in Italy, but that’s far from the only potential rebound signal to be aware of. Here’s a sector by sector breakdown of how the pandemic is impacting European equities.

Coming Up…
Europe will get a first glimpse of how badly the coronavirus has already scarred its economy this week, starting with a reading of consumer confidence from the euro area today. We’ll also get consumer confidence data from Turkey, along with an interest rate decision from Kenya. The corporate earnings schedule is light. In the U.K., regulators may request companies delay financial statements due to virus chaos.

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