Stock markets across the globe are suffering their worst week since the global financial crisis of 2008 as fears over the impact of the coronavirus continue to grip investors.

Markets in Europe fell sharply on Friday morning, with London’s FTSE 100 index sinking more than 3%.

Asian markets saw more big falls, while in the US, the Dow Jones recorded its biggest daily points drop on Thursday.

Investors are worried the coronavirus impact could spark a global recession.

The news of more coronavirus cases, notably in Italy, has raised concerns of a much larger economic effect than previously expected.

In an interview with Sky News, Bank of England governor Mark Carney warned that the coronavirus outbreak could lead to a downgrade of the UK’s economic growth prospects.

Dozens of firms have warned of disruptions to their supply chains and a decline in consumer demand.

US tech giants Apple and Microsoft have both said their business will be affected, while US investment bank Goldman Sachs warned on Thursday that it now thinks the coronavirus will wipe out any growth in US company profits this year.

Shares in airlines have been especially hard-hit as travel bans are imposed and companies limit staff travel. On Friday, airline group IAG – which owns British Airways and Iberia – said its earnings had been affected by “weaker demand” as a result of the outbreak.

Mayank Mishra, a strategist at Standard Chartered Bank, said: “Previously the market had taken some comfort in the falling infection rates in China as a result of containment measures put in place earlier.

“But the spread of the coronavirus infection outside China, with clusters emerging in South Korea, Italy and Japan, has increased concerns significantly.”

Several key global market indexes – including the FTSE 100 and the Dow Jones – have fallen 10% from recent highs. A drop of that magnitude is generally referred to as a correction.