London and New York stocks sank on Friday after US President Donald Trump lashed out at China over the coronavirus crisis, bringing back bad memories of a damaging standoff between both countries over trade.

The eurozone's key equity markets were shut for a public holiday as were several exchanges in Asia.

Investor nerves were tested further by a weak bottom line for Amazon even after the retail giant's revenues received a boost from online shopping under the coronavirus lockdown.

The company warned earnings in the second quarter would be entirely wiped out by expenses related to COVID-19.

"Global markets continue to languish in what Amazon highlighted. That is, top-line growth is not translating into profit growth," said Stephen Innes, chief global market strategist at AxiCorp.

The Dow finished 2.6 percent lower, an ugly start to a new month after major indices scored their biggest monthly gains in decades in April.

Besides Amazon, which plunged 7.6 percent, Exxon Mobil was another big loser following disappointing earnings, while airlines and hotels suffered brutal losses.

Investors were spooked by comments from Trump indicating he could hit China with additional tariffs over its handling of the COVID-19 pandemic, claiming he had seen evidence linking a Wuhan lab to the contagion.

"Trump sharpening his rhetoric against China is unnerving investors, as his team look into retaliatory measures over the coronavirus outbreak," said City Index analyst Fiona Cincotta.

"The China trade war seems like an eternity ago after coronavirus has dominated market movements with such intensity over recent weeks.

"However, threats of more tariffs from Trump have hit a nerve... and (are) adding to the downbeat sentiment heading into the weekend," she added.

Investors in Britain took their cue from earlier losses in Tokyo and Sydney in Asia, where most bourses were closed.

London's FTSE 100 index had already tanked Thursday on mounting evidence that the virus was slamming the global economy and investors "reacted to some stinky data from Europe and the US," analyst Neil Wilson said.

Clouds over earnings
Clouds over earnings AFP / Thomas SAMSON

Sentiment was also hit after Spain said Friday that its gross domestic product was projected to fall by 9.2 percent in 2020 as a result of the coronavirus pandemic, while the unemployment rate would reach 19 percent.

The gloomy forecast compared with two percent growth recorded last year.

In Asia and the Pacific, Japanese and Australian stocks tumbled, with traders tracking Thursday's sell-off on Wall Street. Tokyo was down nearly three percent at the close.

New York - Dow: DOWN 2.6 percent at 23,723.69 (close)

New York - S&P 500: DOWN 2.8 percent at 2,830.71 (close)

New York - Nasdaq: DOWN 3.2 percent at 8,604.95 (close)

London - FTSE 100: DOWN 2.3 percent at 5,763.06 (close)

Tokyo - Nikkei 225: DOWN 2.8 percent at 19,619.35 (close)

Brent North Sea crude: FLAT at $26.44 per barrel

West Texas Intermediate: UP 5.0 percent at $19.78 per barrel

Euro/dollar: UP at $1.0978 from $1.0955 at 2100 GMT

Dollar/yen: DOWN at 106.93 yen from 107.18

Pound/dollar: DOWN at $1.2494 from $1.2594