SYDNEY (Reuters) – Asian markets were set for a fraught session on Tuesday after Wall Street suffered its biggest one-day loss since the 2008 financial crisis, piling pressure on policy makers globally to short-circuit the panic.

Speculation of more central bank rate cuts and possible fiscal stimulus did see U.S. Treasury yields edge up from historic lows, and oil prices paused after the steepest fall since the 1991 Gulf war.

“The collapse in oil prices and associated credit concerns for producers has added another negative layer to a market already on its knees over the COVID-19 outbreak,” said Rodrigo Catril, a senior FX strategist at National Australia Bank.

“Talk of coordinated fiscal and monetary support is getting louder,” he added, noting U.S. President Donald Trump was promising “major” steps to support the economy.

E-Mini futures for the S&P 500 were at least trying to steady, rallying 1% in Asia after an early slide.

Nikkei futures also came off lows, though they were still 600 points below Monday’s cash close.

Wall Street had been on the brink of a bear market with all the major indices down almost 20% from their all-time peak, which amazingly were touched just 13 sessions ago.

The Dow fell an eye-watering 7.79%, while the S&P 500 lost 7.60% and the Nasdaq 7.29%. All 11 major sectors of S&P 500 ended the session deep in the red, with energy and financials taking the worst hit.

Energy stocks led the losses globally after Brent crude futures closed down 24% as markets braced for a price war between Saudi Arabia and Russia.

U.S. crude inched up 92 cents to $32.05 on Tuesday, though that followed a 24% plunge overnight.

Headlines on the coronavirus were no better with Italy ordering everyone across the country not to move around other than for work and emergencies, while banning all public gatherings.

CENTRAL BANK CIRCUIT BREAKER

Such has been the conflagration of market wealth, that analysts assumed policy makers would have to react aggressively to prevent a self-fulfilling economic crisis.

“Without a circuit-breaker, there is a risk the volatility tightens global financial conditions and weakens economies,” said Kim Mundy, an international economist at CBA.

“Because of the risks, we expect central banks to cut policy interest rates further as well as use other, unconventional, monetary policy tools.”

The U.S. Federal Reserve on Monday sharply stepped up the size of its fund injections into markets to head off stress.

Having delivered an emergency rate cut only last week, investors are <0#FF:> fully pricing an easing of at least 75 basis points at the next Fed meeting on March 18, while a cut to near zero was now seen as likely by April.

Britain’s finance minister is due to deliver his annual budget on Wednesday and there is much talk of coordinated stimulus with the Bank of England.

The European Central Bank meets on Thursday and will be under intense pressure to act, even though rates there are already deeply negative.

Bonds have charged ahead of the central banks to essentially price in a global recession of unknown length. Yields on 10-year U.S. Treasuries reached as low as 0.318% – a level unthinkable just a week ago – and were last at 0.54%.

The dive in yields and Fed rate expectations has put an end to a multi-year uptrend for the dollar, to the benefit of the Japanese yen, euro and Swiss franc.

The dollar was huddled at 102.48 yen, having shed 2.8% overnight in the largest one-day drop since late 2016. Chart support was put around 101.20 but was unlikely to stop a retreat to the next major bear target at 100.00.

The euro was lording it at $1.1430, after climbing 1.4% on Monday to the highest in over 13 months at $1.1492.

Gold was restrained to $1,668.20 per ounce amid talk some investors were having to sell to raise cash to cover margin calls in stocks and other assets.

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