Dear Rundown Reader,
Our contributor today is keeping a level head…
“The people infected and the death toll will have to get a lot worse before the numbers get to the level of the annual flu season in this country, and China has a population much larger than ours.
“Being well-informed is prudent, but right now I am not at all worried, let alone to the point of fear-mongering.”
True. So we tracked down the most recent stats.
According to the Centers for Disease Control and Prevention: “CDC estimates that influenza was associated with more than… 34,200 deaths during the 2018–2019 influenza season.” Compare that to the Chinese official estimate of 1,107 coronavirus deaths as of Monday.
While the influenza season lasts about 13 weeks from late fall to early spring in the U.S., the new coronavirus was officially acknowledged in late December, so we’re at six weeks and counting.
Your Rundown for Wednesday, Feb. 12, 2020
Our Best Guess…
We promised Monday we’d check how the coronavirus outbreak is affecting China’s economy. And, in turn, the U.S. economy.
(Correction: It’s called Covid-19 — a mashup of corona, virus, disease plus the year it started; the death toll now exceeds 1,000. At least, officially.)
We spotted this at Al Jazeera yesterday: “More than 300 Chinese companies are seeking bank loans totalling at least 57.4 billion yuan ($8.2bn) to help soften the effect of the coronavirus outbreak…
“Among the prospective borrowers are food delivery giant Meituan Dianping, smartphone maker Xiaomi, ride-hailing provider Didi Chuxing Technology, facial recognition start-up Megvii Technology and internet security business Qihoo 360 Technology,” the article says.
Though it’s difficult to project the long-term economic impact of the disease — something about a communist country’s opacity? — economists expect China’s GDP to drop from 6 to 4% for the first quarter of 2020.
As for the effect on the U.S. economy: “Headwinds from the virus could knock 40 to 50 basis points off expected U.S. economic growth of up to 2.4% per quarter for 2020,” Reuters reports.
Industries most vulnerable to events in China? Air travel and electronics that will suffer the impact of supply-chain slowdowns.
However, acting Chief Economist for Wells Fargo Jay Bryson says: “We wouldn’t say this is going to bring the U.S. economy to its knees. Americans are pretty resilient when it comes to consumer spending.”
But if the spread of the disease continues unabated for a long period of time, the global economic impact is anyone’s guess.
Market Rundown for Wednesday, Feb. 12, 2020
S&P 500 futures are up 16 points to 3,373.
Oil’s revving up 2.7% to $51.28 for a barrel of WTI.
Gold’s steady at $1,570 per ounce.
Bitcoin is breaking through resistance, up $130.18 to $10,335.27.
We’ll catch up on Friday. Have a great day.
For the Rundown,