Stocks are opening sharply lower on Wall Street and bond yields are sinking to more record lows as investors fear that economic damage from the spreading coronavirus outbreak will be longer than previously thought. Major U.S. indexe are down more than 2% in the early going. European markets were down even more and Asian indexes also closed sharply lower. The yield on the 10-year Treasury note dropped to 0.71%. Gold prices rose as investors ducked for cover and the price of oil fell 3.8% as investors doubted whether OPEC can agree with Russia on cutting production to keep up with falling demand.

THIS IS A BREAKING NEWS UPDATE. AP’s earlier story follows below:

World stocks and the price of oil dropped sharply again Friday as pessimism prevailed over hopes for central bank action to counter the economic disruption from the virus outbreak.

Rumors that Chinese officials might be overstating the extent to which local businesses are getting back to work also were undermining confidence, traders said.

After broad losses in Asia, France’s CAC 40 shed 3.7% to 5,160, while Germany’s DAX fell 3.6% to 11,515. Britain’s FTSE 100 shed 3.2% to 6,490. U.S. shares were set to slide again, with Dow futures down 2.1% and those for the S&P 500 falling 2.4%.

Bond yields were down as traders expected central banks to have to cut interest rates and flocked to government debt as a haven of safety.

Markets have endured roller coaster ups and downs for weeks amid uncertainty over how much damage the outbreak of the new coronavirus will do to the global economy.

“At this point no one can really explain why the markets behave the way they do, and what may be next. The only thing we can say is this high volatility is bad,” said Ipek Ozkardeskaya, a senior analyst at Swissquote Bank.

“Bulk holiday cancellations and a significant drop in all-purpose travels added to anxiety of disrupted supply chains and rumors that China may be lying about the resumption of activity explain why the issue goes beyond governments’ and central bankers’ control this time,” she said in a commentary.

After shutting down most business and ordering tens of millions of people to stay home in the most stringent mass quarantine efforts ever, the Chinese government has been gradually urging companies to get back to work while taking precautions to protect their employees.

But it’s virtually impossible to know just close to normal the situation has become in such a vast country. Communist Party officials have a long tradition of embellishing on statistics to fit official targets.

The financial magazine Caixin reported some companies are leaving lights and air conditioners running in empty offices and faking work records.

Japan’s benchmark Nikkei dived 2.7% to finish at 20,749.75. Australia’s S&P/ASX 200 lost 2.8% to 6,216.20. South Korea’s Kospi dropped 2.2% to 2,040.22. Hong Kong’s Hang Seng declined 2.3% to 26,146.67, while the Shanghai Composite skidded 1.2% to 3,034.51.

In China, shares have been steadying along with the outbreak, with the Shanghai benchmark gaining nearly 12% since scraping bottom on Feb. 3. But there are doubts about just how quickly businesses will recover.

“Markets have shifted from pricing temporary China weakness to a more protracted global event, which will see a good chunk of global GDP go up in smoke,” Stephen Innes of AxiCorp. said in a report. That has goaded central bankers into action, but no amount of easy credit will “get people on a flight to Milan or cruise ships to Venice and visiting St. Marks Square,” he said.

As is often the case, investors are taking refuge in the Japanese yen, which has surged against the dollar, and in bonds, pushing prices higher and yields lower.

The yield on the 10-year Treasury note went as low as 0.699% on Friday for the first time in history. Tumbling yields have brought the average rate on a 30-year fixed mortgage to a record low of 3.29%.

Energy markets, meanwhile, were roiled by concerns that the OPEC cartel and ally Russia were struggling to agree on production cuts needed to limit the drop in market prices. The price of crude has fallen over 25% since the start of the virus outbreak as economic activity is disrupted.

Benchmark U.S. crude gave up $1.95 to $43.95 in electronic trading on the New York Mercantile Exchange. Brent crude, the international standard, shed $2.06 to $47.93 per barrel.

The dollar fell to 105.30 Japanese yen from 106.13 yen on Thursday. The euro strengthened to $1.1328 from $1.1140.

The Associated Press receives support for health and science coverage from the Howard Hughes Medical Institute’s Department of Science Education. The AP is solely responsible for all content.

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