The Dow Jones Industrial Average—an imperfect but nonetheless commonly-used metric to track the performance of the U.S. stock market—plummeted on the morning of March 9th. While understanding the ins and outs of the stock market pretty much requires a degree in economics, no such degree is needed to posit that the driving force behind this crash is the coronavirus. In our global economy, the decline of one country’s economy almost surely means that of another, and this is especially true when the primary factor behind such a trend is a global virus outbreak. In the Tokyo Stock Exchange, in particular, declining stock prices have led to what has just been determined to be the worst performance of many major gaming companies’ stocks in over 10 years.
These include, as of the closing of the market on the night of March 8th, a -3.96% decline in Nintendo stock, -5.79% in Square Enix, -6.74% decline in Sega, -6.76% in Konami, -7.31% in Sony, and a whopping -17.58% in Nippon Ichi, the prolific developers of, among numerous other series, the Disgaea franchise.
While the simple explanation for today’s stock market condition is the coronavirus, the precise reasons are not so straightforward. The primary incident responsible for these historically low numbers was a reduction in the price of oil by the country of Saudi Arabia for its major buyers. This followed a disagreement between Saudi Arabia and Russia over oil production in the country.
On one hand, gas prices in the U.S. are likely to fall in the coming days due to Saudi Arabia’s price cuts. On the other hand, countries all over the world are now having to deal with massive devaluations as a result, including seemingly every major Japanese gaming company. While a major factor, oil prices are not the sole reason for the stock market crash; that said, the justification for Saudi Arabia’s falling prices and the general panic over stock prices are one in the same.
This is not the first, and likely not the last instance of the gaming industry being impacted by concerns over coronavirus. 2020’s Game Developers Conference (GDC) has been postponed; this past week’s Final Kombat, a Mortal Kombat tournament, happened without a live audience; and FLASHPOINT’s once-Stockholm-based CS:GO league has been relocated entirely to Los Angeles. These are only a few recent examples of what has been and very well may continue to be a trend with gatherings of large amounts of people into the coming weeks.
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