On Monday the American stock markets were closed sharply where all the three indexes posted their devastating losses on a daily basis in months. Due to the increase in the number of deaths and the infections that are growing very fast from the coronavirus, there are worries on the economy. The daily decline for the Dow and Jones and the S&P 500 represented the worst daily drops since October 2nd and that of Nasdaq Composite since August 23rd. Dow and Jones has fallen for five consecutive days and this is the longest losing streak since August last year.
The stocks have been driven to their lowest levels due to the worries about the spread of the virus in continental China. The death count has risen to more than 200 as of Monday while those that have confirmed cases are almost 3000. Other countries that have confirmed corona virus cases include France and Japan. The U.S. President has offered help to the Chinese government. However, Trump insists that Beijing should control the coronavirus outbreak in Wuhan from spreading to other regions.
Among the city’s 11 million people, 5 million had travelled before the travel ban was imposed. The virus may be infectious in its incubation period that lasts for 14 days. In 2002-03, SARS hit China and impacted on its economy. According to foreignpolicy.com, the potential impact of coronavirus is to slow down by 5.7% in 2021 from 6.1% last year. Half of the 30 Dow components are expected to report their results this week.
On Monday, the government reported that the new home sales in the United States decreased by 0.4% in December last year. The sales are expected to rise from the first quarter of 2020. The stocks that were in focus are: Shares of AbbVie Inc. ABBV, Allergan AGN, Arconic Inc. ARNC and Marathon Petroleum Corp. MPC. Despite coronavirus fears, shares of vaccine makers and diagnostic companies were active. The Co-Diagnostics Inc. CODX, NanoViricides Inc. NNVC, Allied Healthcare Products Inc. AHPI, Inovio Pharmaceuticals Inc. INO and Novavax Inc. NVAX.
U.S. Treasury note dropped 7.5 basis points to 1.605%. West Texas Intermediate crude also dropped by 1.9%. Bullion prices rose by 0.4% settling at $1,577.40. Many Asian markets were closed for the Lunar New Year including the Nikkei 225 and crude oil CLH20. European stocks closed lower, with the Stoxx Europe 600 index SXXP at +0.25% shedding 9.57 points its largest daily percentage decline since Jan. 17.
Dil Bole Oberoi
