Five Things You Need to Know to Start Your Day
More warnings as coronavirus fallout worsens, Iowa keeps us waiting for vote result and oil recovers some ground on OPEC talks. Here are some of the things people in markets are talking about today.
The total number of coronavirus cases in China approached 20,500 with 425 deaths, while Hong Kong reported the second fatality outside the mainland. President Xi Jinping warned that the outbreak imperiled social stability in the world’s most populous country. The People’s Bank of China added liquidity to the market for a second day as the risks to the economy from the virus show little sign of abating. Casinos in Macau will close for 15 days, flight cancellations continue to mount and the list of companies warning about the effect on their bottom line grows longer.
Voting in the Democratic presidential race got off to an inauspicious start in Iowa where new technology introduced to help make the process more transparent produced results that contained “inconsistencies.” The party now says results will be announced at an unspecified point later today. Ahead of the official result, Pete Buttigieg said he was victorious, while Bernie Sanders’s campaign released a ranking showing Sanders in first place. On the Republican side, President Donald Trump topped the GOP selection with 97% of the vote.
Technical experts from the OPEC+ coalition are meeting in Vienna today to evaluate the impact from the virus outbreak on demand for oil. Demand for crude products in China appears to have plunged by 20% as cities are quarantined and factory production halted. Saudi Arabia has been pushing for a meeting to consider new production cuts to bolster oil prices in the face of the drop in demand. In the market this morning, a barrel of West Texas Intermediate for March delivery was trading at $50.77 by 5:45 a.m. Eastern Time, recovering from yesterday’s plunge below $50 as investors now see increasing chances of further reductions in output.
Chinese stocks did not have a repeat of yesterday’s sell-off which is helping global equities make back some ground. Overnight the MSCI Asia Pacific Index added 1.1% while Japan’s Topix index closed 0.7% higher. In Europe the Stoxx 600 Index had risen 1% by 5:45 a.m. with mining and energy stocks the best performers. S&P 500 futures pointed to a strong open, the 10-year Treasury yield was at 1.575% and gold slipped.
At 10:00 a.m., U.S. factory orders and the final print of durable goods orders for December are published. Among the companies reporting earnings today are Ford Motor Co., Walt Disney Co. and ConocoPhillips Co. President Donald Trump will deliver his annual State of the Union address this evening, with the speech likely to take credit for the strong economy as he seeks to move past the impeachment battle.
What we've been reading
This is what's caught our eye over the last 24 hours.
- Odd Lots: This is how to use fiscal stimulus to stave off the next recession.
- Coronavirus forces world’s largest work-from-home experiment.
- CFA’s first exam is getting shorter, more frequent and electronic.
- No city hates its landlords like Berlin does.
- Behind Amazon’s HQ2 fiasco: Jeff Bezos was jealous of Elon Musk.
- Clean power so cheap a staunch defender of U.S. coal went green.
- Self-driving cars have an ice problem.
©2020 Bloomberg L.P.