Five Things You Need to Know to Start Your Day
Five Things You Need to Know to Start Your Day
(Bloomberg) --
Good morning. China has locked down Wuhan to stem the mystery virus’s spread, it’s ECB decision day and the Brexit deal has finally cleared the U.K. Parliament. Here’s what’s moving markets.
Wuhan Lockdown
Chinese officials have halted travel from Wuhan, the city where the new SARS-like virus first appeared, in the latest bid to stop the spread of the coronavirus that has already claimed 17 lives and infected hundreds of others. The travel ban comes before the country’s Lunar New Year break, when hundreds of millions of people are set to travel in the biggest annual migration of humans on the planet. Asian stocks are sliding on the news and Macau, a casino hub, has cancelled all new year festivities. As for the rest of the world, the World Health Organization in Geneva last night said it needed more time before determining whether the situation is an international health emergency. In the meanwhile, here’s what life is like inside China’s virus zone and why Wuhan is the center of the outbreak.
ECB Decision
It’s European Central Bank day, and the governing council’s policy decision is set to be dominated by the first appraisal of its inflation goal since 2003. ECB President Christine Lagarde is set to announce a strategic review that could last the rest of the year just as the euro-zone’s economy has brightened. In terms of actual decisions, economists expect the deposit rate to stay at minus 0.5% and quantitative easing to remain at 20 billion euros a month when the decision is announced at 1:45 pm. in Frankfurt. And in case you didn’t remember to buy it a card, yesterday was the five-year anniversary of quantitative easing.
Brexit Deal
And then it was done. After four years of paralyzed British politics, Prime Minister Boris Johnson’s Brexit deal cleared its final hurdles in Parliament. The bill now goes to Queen Elizabeth II, whose signing of the deal will put the U.K. on track to leave the EU by the end of the month. So now it’s time for the next stage: business. U.K. Chancellor of the Exchequer Sajid Javid risked a clash with President Donald Trump’s government when he said reaching a trade deal with the European Union has to come before the U.S., and the City of London is also asking the U.K. government to revamp regulations to attract global business.
Italian Turmoil
With the Italian government’s coalition in turmoil after Luigi di Maio stepped down from his post as head of the anti-establishment Five Star Movement, Prime Minister Giuseppe Conte has cancelled his trip to Davos. Instead of touting Italy’s environmental credentials in the Alps, Conte will be attending urgent meetings ahead of Sunday’s crucial regional elections. That vote could trigger chaos within the governing coalition parties if Matteo Salvini’s League defeats the Democratic Party in one of its historical strongholds. The prospect of a Salvini comeback hung over markets yesterday, with an index of Italian bank stocks dropping 1.7%.
Coming Up…
Crude is falling along with Asian stocks, with China’s CSI 300 set for the biggest loss since May and dragging down U.S. futures. In Europe, just a few of the big names reporting are mining company Anglo American Plc and online retailer Asos Plc. Franco-Italian chipmaker STMicroelectronics NV is already out with sales that beat the highest estimate. After market, investors will be watching to see if French grocer Carrefour SA fared any better than domestic rival Casino Guichard-Perrachon SA in fending off the impact of transport strikes.
What We’ve Been Reading
This is what’s caught our eye over the past 24 hours.
- Meet the Tesla skeptics.
- Quants say they can make investing more sustainable.
- The other fake meat tycoon.
- The poker-playing billionaire buying London real estate.
- A waste-free economy catches on at Davos.
- What to buy for the year of the rat?
- Bezos hack claim clouds Saudi Prince’s big year.
To contact the editor responsible for this story: Phil Serafino at pserafino@bloomberg.net
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