Stocks Surge As Oil Prices Rally

Stocks have their biggest gain in weeks as Wall Street is encouraged by a vaccine prospectvaccine prospect. Many of the world’s economies have begun to loosen restrictions on commerce, the Federal Reserve chair on Sunday signaled that the central bank has more firepower to lend to recovery efforts, and a drugmaker reported positive developments in an early trial of a coronavirus vaccine.



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Taken together, the developments set off a surge in global stock prices and Wall Street had its best day in about six weeks.

The S&P 500 rose more than 3 percent Monday, while stock benchmarks in Europe were 4 percent to 6 percent higher.

Before trading began in the United States, the drugmaker Moderna said its coronavirus vaccine showed promising early results in tests on humans. The early-stage tests were on just eight people, but the hope that a vaccine might be quickly developed was enough to give stock prices a lift.

Also bolstering markets was a pledge from Jerome H. Powell, the Fed chair, that there was “really no limit” to what the central bank could do with its emergency lending facilities.

“The one thing I can absolutely guarantee is that the Federal Reserve will be doing everything we can to support the people we serve,” Mr. Powell said during a television interview broadcast on Sunday.

The Fed chair also suggested that the worst economic readings were yet to come, even as states begin to gradually reopen. He said that he expected “a couple more months” of job losses and acknowledged that the unemployment rate, which hit 14.7 percent in April, could peak at 20 percent or even 25 percent.







Still, investors were looking for silver linings as the world grapples with lockdowns and other restrictions. Japan released economic figures on Monday that showed its economy formally fell into recession, but Tokyo has begun easing some of its containment efforts. Some restrictions have also been lifted in parts of Europe and the United States.

And trading on Monday had all the characteristics of a rally focused on the prospects for a return to normal. Shares of companies that stand to gain the most, like United Airlines, Expedia Group and Marriott International, were among the best performers in the S&P 500.

Businesses that have benefited as Americans stockpiled food and cleaning supplies, like Campbell Soup and Clorox, were among a small number of decliners.

Oil prices also reflected optimism about the economy, with West Texas Intermediate, the U.S. benchmark, rising above $30 a barrel for the first time since March. Shares of energy companies like Chevron and Exxon were also sharply higher.



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Big Investors Aren’t Betting It All On A Coronavirus Cure


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Successful efforts that could help billions of people might not result in big profits for shareholders.


Shares are up for companies searching for coronavirus drugs and vaccines.


As drug companies race to discover treatments for the new coronavirus, big investment firms are placing cautious bets on likely winners.

Hedge funds and venture-capital firms, which are in the business of predicting the future for companies and economies, are growing more confident researchers will develop effective drugs to fight the pandemic.

Yet, successful efforts that could help millions—or even billions—of people, might not result in big profits for shareholders, the investors argue. Some are even placing bearish wagers on pharmaceutical companies they believe are attracting excessive excitement over their progress on Covid-19 treatments.

“Most of the stock prices don’t bear semblance to reality,” says Joseph Edelman, who runs Perceptive Advisors, a $4.2 billion New York hedge health-care fund, which is focused on what it sees as the disconnect between the price of stocks like drug company Gilead Sciences Inc. and their potential profits from any treatment or vaccine.

Shares are up for companies searching for coronavirus drugs and vaccines.

Gilead is up 18.9% this year, thanks to remdesivir, an antiviral drug administered intravenously that shortens the recovery time of hospitalized Covid-19 patients, according to recent data.

It is always hard anticipating successful drugs, but those wagering on coronavirus treatments face unique challenges. Some of the most innovative and promising approaches are wholly unproven. Companies are competing with foreign nations and not-for-profit organizations determined to achieve their own breakthroughs. Successful drugs or vaccines may run into pricing, manufacturing and distribution difficulties.

Among the issues investors are struggling with: Can Covid-19 treatments help those sick while also protecting individuals against the virus, or will that require different drugs? Will vaccines render treatments less necessary? Will governments allow companies to charge high enough prices to generate sizable profits?

Larry Robbins, who runs health-care hedge fund Glenview Capital Management, is avoiding bets on possible coronavirus treatments, partly because he expects researchers to find a vaccine, limiting the need for even the most effective treatments.

“We are all cheering for a treatment on a humanitarian level, but as an investor, you have to believe a treatment works, and that sales last long enough for it to have a material impact on a company,” he says.

Gilead is among the stocks that has investors thinking twice. The company expects to manufacture more than one million treatment courses of remdesivir by the end of this year, and the drug could have billions of dollars in new annual sales, investors say. If Gilead can develop an inhaled version of the drug or other alternatives to receiving it intravenously, its popularity could increase, bullish investors argue.


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But Gilead has promised to donate 1.5 million doses of Covid-19 treatments to hospitals free of charge, and the price it would charge thereafter is unclear, raising questions about eventual profits. In the past, Gilead has been criticized for placing high prices on its HIV and hepatitis treatments. It may feel pressure to keep a lid on remdesivir’s cost—especially given President Donald Trump’s past public criticism of drug prices.

If Gilead charges about $4,000 per course, as some investors predict, that would result in $4 billion of revenue for a million patients. That figure would be well below Gilead’s $14.6 billion of added market value this year—without taking into consideration the drug’s development costs, estimated to be about $1 billion, a figure that would reduce any profits.

Some bearish investors aren’t yet convinced of remdesivir’s efficacy.

“Even if the drug has only a modest effect, people will still prescribe it, but Gilead won’t make a lot of money,” says Dr. Joseph Lawler, who runs hedge fund JFL Capital Management, which is shorting, or betting against, Gilead.

Gilead’s company spokesman said the drug company hasn’t yet set a price for remdesivir.

“At this time, we are focused on ensuring access to remdesivir through our donation,” he said. “Post-donation, we are committed to making remdesivir both accessible and affordable to governments and patients around the world.”

Dr. Luciana Borio, who was director for medical and biodefense preparedness at the National Security Council, argues that smaller, private companies may emerge with the most effective treatments, not publicly traded companies, another challenge for investors.

“For technology that’s truly innovative and disruptive there’s opportunity for funding and interest in partnerships,” she says.

Some investors are focusing on treatments that may help those who are sick but also can prevent people from getting the virus, a larger potential market. These investors are betting on therapies that use antibody proteins generated by the body’s immune system. These antibodies may be able to block the action of the coronavirus’s “spike” protein, preventing the virus from infecting healthy cells.

Mr. Edelman, of Perceptive, owns shares of Regeneron Pharmaceuticals Inc., a leader in antibody therapies. The company is using a “monoclonal” antibody approach, where scientists select the most powerful antibodies from recovered coronavirus patients—or, in the case of Regeneron, from mice that have been given human immune systems—clone them, and turn them into drugs.



Regeneron plans clinical trials in early summer and is preparing to manufacture hundreds of thousands of doses each month beginning in late summer.

Robert Nelsen, who helps run venture-capital firm Arch Venture Partners, which made early and successful bets on cancer immunotherapy, is backing VIR Biotechnology Inc., which plans trials for its own monoclonal antibody therapy this summer.

“I’m pushing them every day,” Mr. Nelsen says. “We don’t know if the virus will be weaker or stronger or the same in the fall, but in 1918 it came back stronger, so we have to be prepared.”

Regeneron shares are up 52% this year, adding $23 billion in market value, while VIR is 148% higher and has added $2.3 billion in value. Some investors say if a vaccine is discovered it could limit these shares’ potential. Mr. Nelsen counters that it could take longer than expected for researchers to find vaccines, creating a huge market for antibody treatments.

“Vaccines are never 100% effective,” he argues, “so antibody therapeutics may be key to preventing a re-emergence.”

One high-risk, high-reward strategy: Buying shares of tiny companies with potential upside. Messrs. Edelman and Nelsen hold big chunks of ownership in VBI Vaccines Inc., an unproven biotech company claiming an experimental vaccine approach. The stock closed at $2.07 on Thursday.

Forecasting a winning vaccine is perhaps even harder than predicting coronavirus treatments. By some measures, Chinese companies and a group at Oxford University are in the lead. Some companies say they will distribute a vaccine they develop at cost, potentially reducing profits for others. Still, the potential market is huge—some investors believe a combination of vaccines may be necessary to meet global demand, perhaps a low-cost option for younger, healthier individuals and a more potent one for those who are immune-compromised.

Moderna Inc. has attracted the most excitement among vaccine makers, sending its stock soaring 230% this year, as it moves through human trials. Moderna’s strategy is to produce a vaccine using the virus’s genetic sequence, rather than its actual genetic material. It uses programmed material, called messenger RNA, or mRNA, with the goal of directing a patient’s immune system to produce antibodies to the coronavirus.

The approach, which may be able to produce a vaccine quickly, was described as “impressive” by Dr. Anthony Fauci, director of National Institute of Allergy and Infectious Disease. Pfizer and Germany’s BioNTech are working on their own mRNA vaccine.

But analysts note that mRNA technology is expensive and has never produced an approved medicine or vaccine. Moderna is already worth $24 billion, up from $6.5 billion at the beginning of 2020. As for Pfizer, the company already is worth $211 billion, so it isn’t clear how much a vaccine would increase the company’s value.

Some investors are skeptical of some of the highest-flying coronavirus stocks. Mr. Lawler of JFL Capital is shorting Inovio Pharmaceuticals Inc., a small Pennsylvania company that’s up 314% this year despite limited past success.

A spokesman for Inovio says it is in phase one trials for a Covid-19 vaccine and expects results in June, while working on other medicines.

“The general public is throwing money at headlines,” says health-care investor Brad Loncar at Loncar Investments.



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EU Chief Backs Investigation Into Covid-19 Origin And Says China Should Be Involved

The president of the European Commission backed calls for an investigation into the origin of the new coronavirus and said China should be involved in the process.

Lawmakers in countries like Germany, Sweden and Australia have called for a probe into how the virus started, which has so far infected over 3.2 million people and killed over 230,000.

Speaking to CNBC, Ursula von der Leyen, the head of the EU’s executive arm, said she would like to see China work together with her organization, and others, to get to the bottom of exactly how it emerged.

“I think this is for all of us important, I mean for the whole world it is important. You never know when the next virus is starting, so we all want for the next time, we have learned our lesson and we’ve established a system of early warning that really functions and the whole world has to contribute to that,” she told Geoff Cutmore in an exclusive interview Thursday.

She called for more transparency in the future and said governments needed to learn lessons from the current crisis.

“One of the lessons learned from this pandemic is that we need more robust data, overall, and we need more centralized than an entity that is analyzing those data so that the early warning mechanism is way better,” she said.



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“For example, at the level of the European Union, we know that we need a more robust data system for such situations as we see it right now with the coronavirus. And for building up a system that is, that you can count on.”

China criticized
The new strain of coronavirus, known as Covid-19, was first reported in December in the Chinese city of Wuhan.

While China has deployed medics and sent equipment to nations struggling with the coronavirus overseas, the country has faced criticism over its own handling of the virus, which experts believe originated in a wildlife market, or wet market.

We did not cover up anything, and did not delay any efforts. Le Yucheng – CHINESE VICE PREMIER

In late January, Chinese authorities announced a temporary ban on the trade of wild animals in wet markets, supermarkets, restaurants and e-commerce platforms — but experts and wildlife organizations have called for a permanent ban to help prevent future pandemics.

China has also been criticized for a lack of transparency throughout the outbreak, amid claims that Beijing was too slow to respond. The WHO has cautioned against blaming individual countries for the spread of Covid-19, warning that pointing fingers at nations with a high number of cases could discourage accurate reporting on domestic outbreaks.

China has denied any wrongdoing. In an interview with NBC Tuesday, Chinese Vice Premier Le Yucheng said: “China has been open, transparent and responsible in its Covid-19 response. We did not cover up anything, and did not delay any efforts. We have already publicized the timeline of how we have shared the information on Covid-19.”

Le Yucheng added that there is no international law that supports blaming a country simply for being the first to report a disease. “Neither does history offer any such precedent,” he said.







In the United States, President Donald Trump said Thursday, without offering any evidence, that he has a high degree of confidence that the coronavirus outbreak originated from a laboratory in China. His comments came after the top spy agency in the U.S. said that the country’s collective intelligence community did not believe the virus was manmade or genetically modified.

EU-China relations
When pressed on whether a probe could lead to a weakening of relations with China, von der Leyen disagreed that this would be the case: “No, I don’t think so, because it’s all on our own interest. I mean, this this pandemic has caused so much damage,” she told CNBC.

“So it’s in our own interest, of every country, that we are better prepared the next time. We will, we do not know when such a crisis occurs again, but we should be better prepared now.”

Her comments come at a time when the European Commission has been under pressure for allegedly softening the tone of a disinformation report around the coronavirus. The institution has denied succumbing to pressure from Beijing, but its foreign policy chief, Josep Borrell, has not denied that China had expressed concerns about the report, Politico reported.



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Pandemic Triggers A Wave of Distress, Bankruptcy In Corporate America

What a time to be a restructuring specialist.

Practically overnight, bankers and lawyers who advise companies in distress have become some of the most in-demand workers on Wall Street, ending a long period in which rising markets and abundant capital consigned them to obscurity.

Stay-at-home orders and the shutdown of nonessential business have driven broad swaths of the economy into panic mode. In industries that were already in a precarious position before the crisis, including retail and energy, the coronavirus pandemic has tipped many companies over the edge. A host of oil companies have sought chapter 11 protection, while J.C. Penney Co. JCP 3.69% and Neiman Marcus Group Inc. are expected to file for bankruptcy soon.



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Companies in areas that were previously stable, such as the automotive, travel and leisure industries—and even health care—may soon face similar pressures.

U.S. corporate debt downgraded to selective default, meaning a borrower has failed to meet one or more of its obligations, totaled $64.1 billion for the 12 months ended April 17, according to S&P Global Ratings. That represents only a slight uptick over the pace at the end of January, but the numbers are about to get a lot more bleak.

In the coming months, that figure could top the roughly $340 billion reached at the height of the financial crisis, according to the worst-case scenario estimates from S&P. Even in a less grim scenario, the figure could approach levels reached after the dot-com bust in the early 2000s.

Companies of all stripes are scrambling to avoid a painful reorganization of their capital structures and operations, default or bankruptcy. Many have tapped lines of credit and slashed costs. Some, such as Carnival Corp., Expedia Group Inc. and Airbnb Inc., have issued new equity or debt to public investors or private-equity firms.

For some, those efforts could tide them over until conditions improve. But should the recession prove deeper than envisioned, there could be a second—potentially bigger—wave of corporate distress later this year as companies labor under the weight of additional debt taken on during the shutdown, advisers warn.

“We will definitely see an uptick in defaults and an uptick in restructurings,” said William “Tuck” Hardie of Houlihan Lokey Inc., one of the top banks in restructuring. “The question is: Is it a 2,000-foot mountain or is it Mt. Everest?”



U.S. companies drew down about $230 billion from revolving credit lines from the beginning of March through April 9, according to an analysis by Goldman Sachs Group Inc. The largest portion—around 17%—went to companies in the automotive industry, with about 15% going to retailers and 10% to travel and leisure purveyors.

Those figures don’t include new revolver borrowings by companies without publicly traded bonds or those financed by private lenders, many of which are private-equity-backed and were already highly indebted.

Hard-hit companies have taken on additional debt on top of using their credit lines—and some may have effectively boxed themselves in by doing so. Carnival earlier this month sold $4 billion worth of senior secured notes backed by assets like its cruise ships. Tying up those assets will make it difficult for the company to go back to the debt market if it needs to raise more cash, according to a person familiar with the company’s capital structure.

Another person close to Carnival said the cruise operator believes it still has a number of financing options available to it if cruising doesn’t return by early next year, and it expects to get access to government-backed loans in some of the markets where it operates.

For private-equity-backed companies, which are typically bought using a heavy helping of debt and a relatively small amount of equity, having little to no revenue can be even more painful. Loans to fund new buyouts had average debt of 5.93 times earnings before interest, taxes, depreciation and amortization in 2019—the highest since 2007, when the average was 6.23 times, according to S&P Global Market Intelligence’s LCD.

Working in their favor is the fact that 85% of so-called leveraged loans issued in 2019 were “covenant lite,” giving borrowers more breathing room. That figure has risen steadily over the past decade as investors clamored for yield. In 2010, only 10% of leveraged loans were covenant lite, according to data compiled by J.P. Morgan Asset Management.



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Also backstopping companies owned by buyout funds: Firms have around $2 trillion in unspent cash to invest in private markets, with most of that dedicated to private equity, according to alternative-investments manager Hamilton Lane Inc. Much of the dry powder is in the hands of the biggest firms, however, and companies’ fate will be determined by their owners’ willingness to inject more capital at a time when future prospects are highly precarious.



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And the universe of companies facing distress stretches well beyond the world of private equity, said Steve Zelin, head of restructuring at investment bank PJT Partners. “It doesn’t matter if you were five times levered or two times levered prior to the current crisis if you are now not generating any revenue.”

Investment firms that specialize in distressed investing have been gearing up for more action. Oaktree Capital Group LLC aims to raise $15 billion for what would be the biggest-ever distressed-debt fund, according to a person familiar with the matter.

Apollo Global Management Inc. has already invested more than $10 billion since the beginning of March in credit and private-equity.

James Zelter, the firm’s co-president who heads its $200 billion-plus credit business, says he sees three phases of distress playing out.

The first occurred during the early days of market turmoil in March, when even the debt of companies unaffected by the virus was trading at big discounts. The second is the industry-specific declines that led to the rescue financing companies like Expedia have been receiving.

“The third phase is just beginning,” Mr. Zelter said.




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The Coronavirus Shutdown Will Induce The Sharpest Economic Downturn And Push The U.S. Budget Deficit To The Highest Levels Since The 1940s

Some degree of social distancing is expected to continue through the first half of 2021, the CBO said.

The economy is likely to shrink 12% in the second quarter—a 40% drop if it were to persist for a year—and the jobless rate will average 14%, the nonpartisan research service said Friday. Job losses will come to 27 million in the second and third quarters.

The federal budget deficit is expected to reach $3.7 trillion by the end of the fiscal year on Sept. 30, the CBO said, up from about $1 trillion in the 12 months through March. Congress has authorized unprecedented deficit spending to offset the shutdown of vast swaths of the U.S. economy.


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As a proportion of gross domestic product, the deficit will end the fiscal year at almost 18%, its highest level since the year after World War II ended and up from 4.6% in 2019, the CBO said.

Federal debt held by the public is projected to hit 101% of gross domestic product by the end of the fiscal year, up from 79% at the end of fiscal 2019, the CBO said.

The silver lining is that interest rates are projected to fall so low that the government’s net borrowing costs will decline even with the dramatic increase in borrowing, the CBO said. It sees the yield on 10-year Treasury notes hovering at 0.7% in the second half of this year and through 2021.

The updated forecasts, published in a blog post by CBO Director Phillip Swagel, rest on assumptions that are “subject to enormous uncertainty.” These include the extent to which the coronavirus is brought under control in the coming months and the possibility of a subsequent re-emergence.

Some degree of social distancing is expected to continue through the first half of 2021, the CBO said. But those measures are projected to diminish by roughly 75% in the second half of this year relative to the April-June quarter and continue easing into 2021.



As a result, economic activity is projected to recover from its current nadir, but only gradually. GDP is expected to contract 5.6% in 2020 from last year and to grow 2.8% in 2021.

The unemployment rate is seen topping out at 16% in the third quarter and declining to 9.5% by the end of 2021. But the CBO cautioned that those numbers understate the extent of damage because they only count people who are actively looking for a job.




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Bets Against the Stock Market Rise to Highest Level in Years

Short sellers have revived their wagers against the stock market in recent weeks, taking their most aggressive positions in years.

Bets against the SPDR S&P 500 Trust, the biggest exchange-traded fund tracking the broad index, rose to $68.1 billion last week, the highest level in data going back to January 2016, according to financial analytics company S3 Partners. That was up from $41.7 billion at the beginning of 2020 and $41.2 billion a year ago.

Short sellers borrow shares and sell them, hoping to repurchase them at lower prices and keep the difference as profit. Among the individual companies they have targeted in recent weeks are travel-related firms, including Carnival Corp., Royal Caribbean Cruises Ltd., Marriott International Inc. and Wynn Resorts Ltd.


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Those bets come during a wild year for investors who are struggling to reconcile the impact of the coronavirus pandemic on the population and economy. The S&P 500 suffered its fastest drop from a record to a bear market in history—ultimately falling 34% between Feb. 19 and March 23. Its 28% rebound since then has also been brisk, leaving some investors anxious about the strength of the rally when so much remains unknown.

“We’ve really seen a significant bounceback in the last three weeks at levels that I think are too quick,” said Jerry Braakman, chief investment officer at First American Trust. His firm recently bet against the Nasdaq-100, on the belief that technology stocks have fallen too little to reflect the probability of a recession. The index is up 1.1% in 2020.

“When we see a strong move in one direction, where we think the fundamentals and the news can turn ugly, especially during an earnings cycle, we think that’s an opportunity where we could see a 5, 10% selloff again,” he said.

Investors are bracing for the possibility of more volatility this week, as earnings reports from companies including Coca-Cola Co., Netflix Inc. and Delta Air Lines Inc. give another glimpse at how the coronavirus is reshaping the landscape for U.S. business.

The outsize market swings of late require vigilance from investors who sell shares short because they can face losses when prices rise. Short sellers incurred total mark-to-market losses of $108.8 billion over three days in late March when the S&P 500 surged 18%, according to Ihor Dusaniwsky, head of predictive analytics at S3 Partners.

But with the potential for additional declines ahead, many investors have decided that the ability to hedge their portfolios—or simply bet on a selloff—is wise.

“Things will go back to normal eventually and these positions will decrease but not until we start seeing less volatility in the market,” Mr. Dusaniwsky said of the rise in short positions against the SPDR S&P 500 Trust. “No one’s going to give up their insurance until they see the chances of catastrophe are in the rearview mirror.”

The portion of available shares sold short against the SPDR S&P 500 Trust has also risen, climbing to 27% in early April, the highest level since November 2016 and up from 14% at the beginning of 2020.

The increase in bets against the market coincides with a push in other countries to temporarily curb short selling. At times of heightened volatility, critics often argue that the practice exacerbates downward pressure on stock prices. But Jay Clayton, the chairman of the Securities and Exchange Commission, has argued short selling is needed to facilitate ordinary market trading.

To be sure, coronavirus has upended entire industries in recent weeks, leaving investors scrambling to reassess the growth prospects of companies from Marriott to Clorox Co. to Amazon.com Inc. to Carnival.

With the pandemic devastating global travel, hotel, casino and cruise stocks have been among the hardest hit—and seen some of the biggest additions to the short positions against them.

Many hotels and casinos temporarily closed their doors when demand evaporated, furloughing employees and curbing spending plans, and the Centers for Disease Control and Prevention has extended a no-sail order for cruises into July.



Short sellers have added a collective $797 million to their short positions against Carnival, Royal Caribbean, Marriott and Wynn over the past 30 days, according to data Friday from S3 Partners.

Alex Lee, a San Francisco resident who manages a family sandwich shop in Oakland, Calif., and his wife had previously dabbled in short selling but have recently devoted more attention there. They made bets against Marriott, along with other stocks.

“Because of Marriott’s price at the time, it seemed like it had more room to fall and because of its heavy presence in Europe and the United States, we just thought that that company itself would be more vulnerable to falling more,” he said.

Over two rounds of shorting Marriott stock in March and April, they made a profit of about $15,000, Mr. Lee said. Marriott recently said about 25% of its hotels are temporarily closed, and North American occupancy levels are around 10%. Its shares are down 44% this year.


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Among the stocks that saw big drops in short positioning in March were stodgy consumer-staples shares, which got a bounce as Americans stocked their pantries to wait out the pandemic at home.

“We had a lifetime of trading in the month of March,” said Mitch Rubin, chief investment officer at RiverPark Funds. He said he had previously bet against shares of Kroger Co., Walmart Inc., Clorox and Campbell Soup Co. but covered those positions in late February and early March as it became clear those companies would perform well with consumers sheltering in place.

“Their business is healthier than it was before the crisis because the demand for their products has increased,” he said. “The amount of times you clean high-touch surfaces with a chemical disinfectant is going to go up for some period of time, maybe for the rest of our lives.”



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Europe Needs At Least 500 Billion Euros For Recovery

Europe will need at least another 500 billion euros from European Union institutions to finance its economic recovery after the coronavirus pandemic, on top of the agreed half-a-trillion package, the head of the euro zone bailout fund said.

In an interview with Italy’s Corriere della Sera paper, published on Sunday, European Stability Mechanism Managing Director Klaus Regling said the easiest way to organize such funds would be via the European Commission and the EU budget.

“I would say that for the second phase we need at least another 500 billion euros from the European institutions, but it could be more,” Regling told the paper.



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“For that, we need to discuss new instruments with an open mind, but also use the existing institutions, because it is easier, including in particular the Commission and the EU budget. Rethinking European funds can go a long way in keeping the European Union together,” Regling said.

European Union finance ministers agreed on April 9th on safety nets for sovereigns, companies and individuals worth in total 540 billion euros.

They also agreed that the euro zone, which the IMF predicts will plunge into a 7.5% recession this year because of the pandemic, will need money to recover, but they had different ideas on how much is needed and how to raise it.

EU leaders are to discuss that at a videconference on April 23. The idea around which a compromise may emerge is likely to involve the European Commission borrowing on the market against the security of the long-term EU budget and leveraging the money to achieve a bigger effect.



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European Central Bank Headquarters And Frankfurt's Financial District Ahead Of Comprehensive Bank Assessment



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Global Stocks And U.S. Futures Gain Despite China GDP Plunge

Stock benchmarks in the Asia-Pacific region rose, while S&P 500 stock futures traded higher, pointing to a strong session for U.S. shares on Friday.



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Market watchers said a range of factors helped power the rally, including the prospect of the U.S. gradually getting back to work and some encouraging news on potential treatments for the new coronavirus. Investors were able to look past data showing an unprecedented—but widely expected —plunge in Chinese economic activity.

In early-afternoon trading in Hong Kong, E-mini S&P 500 futures gained more than 3%. Australia’s S&P/ASX 200, Japan’s Nikkei 225 and South Korea’s Kospi rose by about 2% to 3% each, and the Shanghai Composite Index added 0.9%, while Hong Kong’s Hang Seng Index advanced 2.3%.

Andy Maynard, managing director of equities sales and trading at China Renaissance Securities, said news about possible coronavirus treatments had buoyed markets. He said that while effective drugs might take years to develop, the developments were catalysts to say the situation isn’t as bad as feared and that markets would recover.

Shares of Gilead Sciences rose 15.1% in late U.S. trading after a report that one of its experimental drugs might be performing well in clinical trials of patients with Covid-19, the respiratory disease caused by the new coronavirus.

Ben Luk, senior multiasset strategist at State Street Global Markets, said other factors were also boosting sentiment in regional markets. Those included the prospect of the U.S. gradually reopening its economy and better-than-expected export figures from Singapore.

Singapore said Friday that exports, excluding oil, rose 17.6% in March from a year earlier, far better than the median 7.9% contraction forecast in a Wall Street Journal poll of 11 economists. “There’s more comfort that China continues to recover based on those export numbers,” Mr. Luk said.



Markets remained strong even as official statistics showed China’s economy shrunk 6.8% from a year earlier in the first quarter. That was the first year-over-year contraction since Beijing began reporting the quarterly figure in 1992, but it was less sharp than the 8.3% median forecast of economists polled by The Wall Street Journal.

“Everybody was expecting a very bad first quarter,” said Chi Lo, senior economist for Greater China at BNP Paribas Asset Management. Mr. Lo said the Chinese government’s goal of doubling the economy in size from 2010 to 2020, in real terms, or after adjusting for inflation, is now out of reach.

He added that the speed with which China’s economy returned to full strength would depend partly on how badly the pandemic hit overseas demand for its goods and services.

In the U.S., President Trump released new federal guidelines on reopening the economy that would leave decision-making largely up to governors. Mr. Trump said: “We must have a working economy, and we want to get it back very, very quickly.”

The Dow Jones Industrial Average and the S&P 500 on Thursday posted modest gains even after data showed another sharp rise in Americans seeking jobless benefits, and slumping construction of new homes.

Globally, confirmed cases of the new coronavirus reached nearly 2.2 million, with the U.S. accounting for nearly one-third of the cases, according to data from Johns Hopkins University. The number of deaths world-wide has topped 143,000.



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Stock Markets Around The World Rose On Optimism That Economic Activity May Improve In The Near Future

Futures tied to the Dow Jones Industrial Average rose 1.5%, suggesting U.S. stocks could gain ground later in the day. The pan-continental Stoxx Europe 600 advanced 1.2%. Asia-Pacific stock indexes also rose Tuesday. The benchmark Shanghai Composite Index closed up 1.6%.

Global coronavirus infections topped 1.9 million, with more than 119,000 deaths, according to Johns Hopkins University data. The number of new cases each day appeared to level off in the U.S., and President Trump told reporters his administration is nearing completion of a plan to reopen the country “hopefully ahead of schedule.” But in Europe, France, Italy and Spain extended lockdowns to curb the spread of the virus.



Investors are watching for news about the length of the lockdowns to try to call when the market has reached a trough and could be set to rise again, said Georgina Taylor, a multiasset fund manager at Invesco.

“Anything that suggests that it’s not a complete catastrophe, people will take that as the bottom,” she said.

Stocks in mainland China were buoyed by better-than-feared trade data, which showed exports in March down 6.6% from a year earlier, and imports down just 0.9%. Economists polled by The Wall Street Journal had forecast declines of 15.9% and 10%, respectively.

Daniel Gerard, senior multiasset strategist at State Street Global Markets, said the pandemic presents investors with an economic calamity unlike either the Great Depression or the global financial crisis, and markets are cycling between fear and relief as headlines change.

“The market may be excited today about China’s trade data being better than expected, but tomorrow it may think it is not enough,” he said.

While China’s trade figures were much better than expected, there were no serious lockdowns outside the country until mid-March, and since then orders have been cut back, said Iris Pang, chief economist for Greater China at ING Bank NV in Hong Kong.

“This will heavily weigh on export and import figures for April and May, at least,” she said.

Elsewhere, Hong Kong’s Hang Seng Index edged up by 0.7%, Japan’s Nikkei 225 closed 3.1% higher, boosted by electronics and retail stocks, while South Korea’s Kospi Composite advanced 1.9%.

Mr. Gerard at State Street said any global economic recovery would be uneven, and while panic-selling had ceased, fundamental questions about corporate profits remain. Investors will need to distinguish temporary damage to earnings from longer-term hits, something that won’t be easy until the second half of the year, he said.

Oil prices edged up. The global benchmark Brent crude climbed 1%, trading at $32.04. The Organization of the Petroleum Exporting Countries and its allies agreed to jointly reduce production by 9.7 million barrels a day after a marathon series of talks from Thursday to Sunday.


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The rally is modest because the fall in energy demand from the economic slowdown still outweighs the production cuts made over the weekend, said Bjarne Schieldrop, chief commodities analyst at Nordic bank SEB.

“It’s very clear that demand loss is tremendous. They [OPEC] are not cutting enough in the short term to prevent inventory build.’’

Earnings season will begin this week, with some of the largest U.S. banks reporting in the coming days. JPMorgan Chase & Co will release its financial statements Tuesday, followed by Goldman Sachs, Bank of America and Citigroup Wednesday.

Also Tuesday, the International Monetary Fund will put out its world economic outlook, which will kick off a week of virtual meetings with a focus on the downturn caused by the coronavirus.


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Stocks Climb, Trying To Extend Winning Streak

U.S. stocks rose sharply Tuesday, buoyed by early indications that the spread of the coronavirus pandemic was slowing in some hot spots around the world.

The Dow Jones Industrial Average rallied 2.8% in midday trading, a day after rising almost 8%. The S&P 500 and the Nasdaq Composite also jumped, climbing 2.3% and 1.5% respectively. All three indexes are attempting to rally for the third time in four sessions, though they remain down about 20% from their mid-February highs.

New York Gov. Andrew Cuomo said Tuesday that the state’s hospitalization rate has showed signs of slowing, and other hard-hit countries in Europe, including Italy and Spain, have reported a slowdown in new infections following strict containment measures.


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“It’s hard to reject the view that things are improving,” said Paul O’Connor, head of multiasset at Janus Henderson. “Markets have been celebrating this in the last couple of days.”

Still, the trends are preliminary and authorities have warned that the coronavirus infections in the U.S. and U.K. are likely to worsen in the coming week. Even as demand for intensive care units has flattened in New York, Mr. Cuomo said Tuesday that deaths related to the virus hit a record Monday. So far, nearly 5,500 people have died from the virus in the state, representing almost half of all U.S. deaths.

Even more, economic indicators have shown that a deep recession may be looming. The Mortgage Bankers Association said Tuesday that mortgage forbearance requests grew 1,896% between the weeks of March 16 to March 30. The spike comes as millions of Americans have sought unemployment benefits after the pandemic shuttered businesses.

Markets have swung sharply in recent weeks as investors have tried to make sense of a fast-spreading pandemic that has warranted unprecedented responses by the Federal Reserve and U.S. government. Monday’s gain marked the 12th consecutive trading day that the Dow moved up or down at least 1%.

All 11 sectors of the S&P 500 marched higher Tuesday. Only two of the 30 stocks in the Dow Jones Industrial Average, Merck and Pfizer, ticked lower.

Travel and leisure stocks were again among the best performers in the U.S. and Europe. United Airlines Holdings jumped 8.3%, American Airlines Group rose 15% and Delta Air Lines added 4.2%. Among cruise stocks, Royal Caribbean Cruises gained 21% and Carnival rose 17%. All five stocks remain down more than 50% for the year.

Meanwhile, in London, EasyJet soared 20% after the carrier tapped a U.K. government-aid program for short-term credit. The company’s ability to access the funding suggests that it could withstand the economic downturn, provided that the spread of the coronavirus continues to slow, according to Michael Hewson, chief market analyst at brokerage CMC Markets.

“Markets are pricing in a return to normality for airlines sooner rather than later,” Mr. Hewson said. That optimism is also driving hotel stocks higher, he added.
The rise in risk appetite led some investors to sell the safest government bonds. The yield on the 10-year U.S. Treasury note rose to 0.749%, from 0.675% Monday. Yields rise as bond prices fall.

Oil prices also ticked higher, with the global benchmark Brent crude advancing 0.3% to $33.15 a barrel.


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In currency markets, the ICE Dollar Index slipped 0.7%. The greenback has been wavering amid renewed risk appetite, according to Jordan Rochester, a currency strategist at Nomura.

“It’s definitely a risk-on day,’’ leading some investors to sell the dollar, he said.





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European Markets Mixed As Coronavirus Cases Top 1 Million

Global stock markets have experienced a shaky start to the second quarter this week as investors to assess the potential economic ramifications of widespread lockdowns and the persistent spread of the coronavirus.

European markets were searching for direction on Friday morning as another rocky week of trading draws to a close amid the deepening coronavirus crisis.

The pan-European Stoxx 600 hovered around 0.2% below the flatline in early deals, with insurance stocks sliding 2.3% to lead losses while media stocks added 1%.

The number of confirmed cases of the coronavirus worldwide surpassed 1 million on Thursday night, resulting in more than 53,000 deaths so far. Italy and Spain have reported over 115,000 and 112,000 cases, respectively, while Germany now has more than 84,000 cases, according to Johns Hopkins University.



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Global stock markets have experienced a shaky start to the second quarter this week as investors continue to assess the potential economic ramifications of widespread lockdowns and the persistent spread of the virus, along with the fiscal and monetary measures being deployed by governments and central banks to mitigate the crisis.

Asian markets were muted on Friday after an initial gain in momentum after oil prices experienced their biggest one-day surge on record, but crude futures retraced some of their gains by Asian afternoon trade.

The sharp moves in crude futures came after U.S. President Donald Trump told CNBC’s Joe Kernen that he expected Russian President Vladimir Putin and Saudi Crown Prince Mohammad Bin Salman to agree to an oil production cut of 10 million to 15 million barrels, potentially halting a bruising price war between the two oil powerhouses.

On the data front, individual and collective final euro zone Markit composite and services PMI (purchasing managers’ index) readings for March are due at 9 a.m. London time, before February’s retail sales numbers at 10 a.m.

U.K. Markit/CIPS composite and services PMIs are expected at 9:30 a.m.






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French Manufacturing Plunges Into Deepest Slump In Seven Years

French manufacturing activity fell in March at the fastest pace in more than seven years as a nationwide lockdown to contain the coronavirus outbreak hits companies and their clients, a monthly survey showed on Wednesday.

Data compiler IHS Markit said its final Purchasing Managers’ Index (PMI) fell to 43.2 points from 49.8 in February, slightly higher than a preliminary reading of 42.9.

The plunge to its lowest point since January 2013 brought the index far away from the key 50-point line dividing expansions in activity from contractions.


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Meanwhile, manufacturers’ output and the flow of orders for new business fell to their lowest levels since the 2008-2009 global financial crisis that unleashed one of the deepest recessions in decades in many major economies.

As the coronavirus spread in France, the government imposed a lockdown on March 17, forcing large swathes of the euro zone’s second-biggest economy to shut down.

“The supply of goods is diminished, with supplier delivery times lengthening sharply and staff unable to work amid factory closures,” IHS Markit economist Eliot Kerr said.



“Meanwhile, restricted movement of people and social distancing has acted to stifle demand, delivering a double-barrelled blow to the economy,” he added.

The INSEE official statistics agency estimated last week that the economy was operating at two-thirds of its normal level, which was likely to knock 3 percentage points off growth for each month the country spends in lockdown.


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Economic Indicators: Consumer Sentiment in U.S. Slumps by Most Since October 2008

U.S. consumer sentiment plummeted in March by the most since October 2008 as mounting Covid-19 cases nationwide and business closures elevated concerns about the economy.

The University of Michigan’s final sentiment index for the month slumped 11.9 points to a three-year low of 89.1, data Friday showed. The median forecast in a Bloomberg survey of economists called for a decline to 90 after a preliminary March reading of 95.9.

Ratings for current conditions also decreased by the most since 2008, and a measure of the economic outlook dropped to the lowest level in more than three years. Stocks fell and Treasuries advanced as investors assessed the pandemic’s impact on the economy.





“The outlook for the national economy for the year ahead changed dramatically in March, with the majority now expecting bad times financially in the entire country,” Richard Curtin, director of the Michigan sentiment survey, said in a statement. “Perhaps the most important takeaway is that the largest proportion of consumers in nearly 10 years anticipated that the national unemployment rate will increase in the year ahead.”

The report provides one of the more-sobering pictures yet of how the widespread economic halt, amid efforts to help contain the virus, is impacting consumers’ attitudes. The March figures represent a drastic departure from just a month earlier, when a strong job market and cheap fuel contributed to the second-highest sentiment reading since 2004.

The university’s final survey for the month included responses through March 24, a stretch that includes significant upheaval and uncertainty in day-to-day living and the labor market, as well as in financial markets. A report yesterday showed initial claims for unemployment benefits soared to a record 3.28 million last week.

“Stabilizing confidence at its month’s end level will be difficult given surging unemployment and falling household incomes,” Curtin said. “Mitigating the negative impacts on health and finances may curb rising pessimism, but it will not produce optimism.”

April consumer sentiment data will reflect the surge in dismissals and growing Covid-19 cases, as well as progress on Capitol Hill toward a $2 trillion economic-relief package that includes direct payments to many Americans.



Most notably, the number of confirmed cases nationwide continues to rise. There are currently more than 85,000 with the disease in the U.S., the most in the world, compared with 62 people at the end of February.

The Michigan data showed an index of buying conditions for durable goods dropped in March to the lowest level since 2014.

Year-ahead financial prospects declined across all age and income subgroups, though modestly as respondents anticipated the negative effects from the pandemic would be short-lived.

The impact of the virus on consumer sentiment are likely to become more evident as monthly reports capture the tectonic shift in economic and market conditions seen over the last month. The Conference Board will publish its March confidence reading on Tuesday. Meanwhile, Bloomberg’s weekly index fell to a four-month low.





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Global Stock Markets Mixed After Lawmakers Agree On Coronavirus Rescue Deal

Stocks turned mixed Wednesday after building on a rally from the previous session in anticipation of a coronavirus rescue deal by Congress. The White House and Senate reached an agreement overnight.

While the Dow was up 450 points and the S&P 500 rose 0.6%, the Nasdaq slipped into the red. The Dow soared more than 2,100 points Tuesday, or over 11%, notching its biggest one-day percentage gain since 1933 and its best point increase ever. The S&P 500 rallied 9.4% for its best day since October 2008.

White House and Senate leaders agreed to a massive $2 trillion coronavirus stimulus bill in the middle of the night.

“At last we have a deal,” Republican Senate Majority Leader Mitch McConnell said around 1:37 a.m. ET from the floor of the Senate. “In effect, this is a war-time level of investment into our nation.”

Former Federal Reserve Chairman Ben Bernanke also said Wednesday the U.S. economy will experience a quick rebound after a “very sharp” recession. “If there’s not too much damage done to the workforce, to the businesses during the shutdown period, however long that may be, then we could see a fairly quick rebound,” Bernanke told CNBC’s “Squawk Box.” Bernanke added the current situation is “much closer to a major snowstorm” than the Great Depression.

He also acknowledged current Fed Chairman Jerome Powell moved quickly to stem the economic blow from the outbreak. “I think the Fed has been extremely proactive, and Jay Powell and his team have been working really hard and gotten ahead of this and shown they can set up a whole bunch of diverse programs that will help us keep the economy functioning during this shutdown period.”

Still, some investors think the number of global coronavirus cases needs to improve before the market can form a bottom.

Spain experienced a record spike in coronavirus deaths, with 504 reported for Tuesday. Globally, more than 400,000 cases have been confirmed, according to data from Johns Hopkins University. In the U.S., more than 55,000 cases have been confirmed along with over 69,000 in Italy.

Peter Oppenheimer, chief global equity strategist at Goldman Sachs, said there are four “components” to the market stabilizing from here:

″(i) A sign that the policy intervention is sufficient to prevent severe second- and third-round economic shocks; (ii) A sign that the infection rate is reaching a peak; (iii) A sign that the economic downturn may be slowing; and (iv) Cheap valuations,” Oppenheimer wrote in a note to clients. “In reality, we believe it will be a combination of these, and in some cases there are already signs these are in place.”



Some investors believed the stock market was overdue for a big bounce, having priced in a worst-case scenario regarding the economic damage being done by coronavirus-related shutdowns. They believe a bounce could occur here even as coronavirus cases continue to surge because the market was so oversold.









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Financial Markets: European Shares Jump Again On Stimulus Bump

European shares rose on Wednesday following a strong rally in the previous session, as investors bet on unprecedented stimulus measures to ease the economic pain on businesses and households from the coronavirus pandemic.

The pan-European STOXX 600 index (STOXX) was up 2.1% at 0804 GMT, with energy (SXEP), industrials (SXNP), financials (SXFP) and miners (SXPP) leading gains for a second straight day.



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The benchmark index has now recovered its losses from mid March on the back of extraordinary fiscal and monetary stimulus from Europe and the United States. On Wednesday, U.S. officials agreed on a whopping $2 trillion stimulus package.

Still, the European bourse is down more than 25% from its record high last month in the biggest rout since the financial crisis, with another global recession looming in the face of a collapse in business activity in March.

German conglomerate Thyssenkrupp (DE:TKAG) rose 12.6% after saying it would cut 3,000 jobs at its steel unit by 2026, with no forced layoffs until March 31, 2026, as part of a wage deal struck with powerful labor union IG Metall.









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Financial Markets – Top 5 Things to Watch This Week

This week market watchers will be looking at economic data releases for early indications of the scale of the impact from the coronavirus pandemic, but the main focus will continue to be on the response from governments and central banks who are ramping up stimulus measures amid market fears over whether steps announced so far will be adequate. Here’s what you need to know to start your week.

Data to show early economic hit from virus
Few doubt that the global economy will tip into recession as countries around the globe go into lockdown amid ongoing virus containment efforts. It goes without saying that large drops are likely in PMI data coming out this week in the U.S., Eurozone and the U.K.

The PMI surveys are typically conducted in the second half of a month and the data in the “flash” survey is usually collected in the week or so before the data is released, so economists reckon next week’s PMIs will provide the most comprehensive overview so far of the coronavirus impact.

Meanwhile, Thursday’s figures on initial jobless claims will be the first to show the full extent of the impact on the U.S. labor market. Economists at Goldman Sachs have estimated claims are set to jump to a record 2.25 million, according to an analysis of preliminary reports across 30 states.

U.S. government response awaited
Republicans and Democrats in the U.S. Senate on Saturday continued with efforts to reach a deal on a $1 trillion-plus bill aimed at mitigating the coronavirus pandemic’s economic fallout for workers and businesses.

White House economic adviser Larry Kudlow said he expects the final legislative package to be worth $1.3 trillion to $1.4 trillion.

Taken together with steps already taken by the U.S. Federal Reserve and the administration, the prospective bill would have a $2 trillion net impact on a U.S. economy, according to White House officials.

Liquidity squeeze to ease?
A liquidity squeeze prompted the Federal Reserve on Friday to enhance the dollar liquidity swap line arrangements it has with the Bank of Canada, Bank of England, Bank of Japan, European Central Bank and Swiss National Bank.

To see if that does the trick, watch for dollar exchange rates to stabilize.



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Demand for the world’s reserve currency had jumped amid a rush for cash in anticipation of a prolonged pandemic, with there being a substantial liquidity mismatch between global demand for U.S. dollars and those on offer.

U.S stock valuation picture may become clearer
As the U.S. stock market has tumbled, valuations have also come down sharply.

The S&P 500’s price-to-earnings ratio, based on earnings estimates for the next year, has dropped from over 19 times in late February to 14.2 times as of last Wednesday, according to Refinitiv data, taking the valuation below its historical average.

But the picture is complicated by the fact that earnings estimates may have not come down enough to account for the coronavirus fallout.

The picture may become clearer in the coming weeks, as the first quarter comes to an end and companies start preparing their results. Last week, FedEx (NYSE:FDX) and Marriott (NASDAQ:MAR) withdrew their 2020 financial forecasts because of the outbreak.

Nike (NYSE:NKE), Micron Technology (NASDAQ:MU), and KB Home (NYSE:KBH) are among the U.S. companies due to report results this week.

Emerging markets
Emerging market assets have been hammered, with currencies plunging to fresh record lows, bonds plunging and stocks down nearly 10% last week. Several factors have contributed – the strong dollar, a darkening economic outlook, tumbling oil prices as well as rising borrowing costs.

Investors piling into the greenback have seen enduring stresses in dollar funding markets, with hurried swap lines between central banks earlier in the week doing little to alleviate the credit strains at the heart of the problem.

Central banks in the United States, the euro zone, Canada, Britain, Japan and Switzerland stepped in again on Friday, agreeing to increase the frequency of their one-week U.S. dollar credit facility.

In emerging markets, policymakers that lack the firepower to support currencies or face challenges to cut rates, will be keeping their fingers crossed that steps taken by major central banks will be enough to end the crisis.










Airbnb Racks Up Hundreds Of Millions In Losses Due To Coronavirus

Airbnb Inc. wrestles with escalating losses due to the devastating impact of the coronavirus pandemic on its global business. The pandemic has thrown into disarray Airbnb’s plans to go public this year, and the company’s board and investors are divided over the best path forward, according to people familiar with the matter.

The San Francisco-based startup, which lets people list their properties for rent on its marketplace, has racked up hundreds of millions of dollars in losses this year, one of the people said. A spokesman for Airbnb said the company has “$4 billion in liquidity” and is “focused with our board on ways we can help our community weather this crisis.”

It is unlikely that the company will be able to attract investors at its 2017 valuation of $31 billion, when it last raised money, the people familiar with the matter said. The management is mulling how low it is willing to go to seek an injection of capital.

The Wall Street Journal reported last month that Airbnb internally was already valuing the company at less than $31 billion.



Airbnb, one of the nation’s biggest private companies, had planned to make its widely anticipated debut on the public markets this year via a direct listing, which wouldn’t involve raising any additional money.

The company is now considering instead raising cash using an initial public offering, and has held several meetings with its board this month to discuss its approach, the people familiar said. Morgan Stanley and Goldman Sachs Inc. have been appointed as dual-lead underwriters. But an IPO could go ahead only when the virus crisis has eased, stock markets stabilize, and the company’s finances recover to a stable footing, the people familiar said.

An Airbnb spokesman said it “should come as no surprise that in these extraordinary times, like virtually every company in the world, we are regularly consulting with our board to discuss our work.”

Airbnb—caught in the crosshairs of the all-out crisis the virus has created in the global travel industry—now faces evaporating revenues, as well as a backlash from the hosts who are the backbone of its business.

All its major markets are getting hammered. Bookings last week were down year-on-year around 95% in Asia, 75% in Europe—the company’s biggest market—and 50% in the U.S., according to one of the people close to the business. A report last week by Airbnb-analytics firm AirDNA also showed bookings tanking in big cities world-wide. This week’s numbers are much worse, the person said.

A spokesman for the company said the figures weren’t accurate but declined to provide other numbers.

Airbnb’s board had already raised concerns about the company sliding into the red, even before the pandemic upended its business, the Journal previously reported. Executives were grilled at a board meeting late last year on why overheads such as its head office and employee expenses had been allowed to balloon, outpacing even the then-rapid growth in revenue.


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Some board members are unhappy that Airbnb didn’t go public last year, when a soaring stock market put premium prices on even unprofitable startups, the people close to the company said. Employees are concerned the listing could now be delayed beyond the end of the year, meaning many valuable stock options will expire, becoming worthless.

One person close to Airbnb said management and the board are working in sync but that outside investors are agitated about the company’s troubles and its response to them.

Brian Chesky, Airbnb’s chief executive, is under intense pressure from employees to go public, after more than 10 years as a private company. He recently sought to reassure staff that a delay won’t happen. In a staff meeting held earlier this month and on a separate phone call with employees last week, he said the company plans to stay the course of going public this year, the people close to the business said.

Some investors are skeptical this will be possible, or question what price the stock might achieve.

The price at which Airbnb shares are trading has fallen sharply, according to people who specialize in the market for private company shares.

Before the pandemic hit, shares were trading privately at more than $140, valuing the company around $45 billion to $47 billion, according to Jared Carmel, managing partner at Manhattan Venture Partners, a secondary-market specialist. Now, he said, “we’re seeing shares tick back to close to $105.” That’s what Airbnb’s shares priced at in its last funding round in 2017, which valued the company at $31 billion, according to Dow Jones VentureSource data.













These Five Warning Signs Highlight Virus’s Rapid Economic Impact

The economic losses from the coronavirus have transitioned from hints of serious difficulties just a week ago to a devastating stoppage at countless U.S. restaurants, hotels, movie theaters, gyms and other service providers, with millions of employees now idled.

While still largely invisible in the mostly dated official economic data, the destruction is clear in private reports on hotels, dining establishments and theaters, many of which are now closed. The key questions center around how much more deterioration remains and how long it will last.

Here are five indicators that give a sense of the emerging crisis for the nation’s businesses.

1. Hotels

The outlook for the lodging industry has quickly gone from bad to worse. In the week ended March 14, occupancy of U.S. hotels plunged to 53%, meaning rooms were about half empty for the week, according to data tracker STR. A year ago, the rate was 70%. The slump occurred even as the industry reduced prices, with average daily rates falling 11% from a year earlier.

With the virus spreading to all 50 states, the falloff in travel is likely to be just the beginning. Seattle, which was an early epicenter of the virus in the U.S., experienced just 33% occupancy, while San Francisco’s was 39%. New York City, which typically is packed with tourists and business travelers, saw a decline to 49%.

Cities that depend on conventions were especially hard hit, said Jan Freitag, STR’s senior VP of lodging insights. “Group cancellations were felt across the markets.”

2. Retail Sales

Retail sales show a somewhat deceptive picture of true demand as they are holding up primarily because Americans are racing to discount and grocery stores to stockpile food, toilet paper and paper towels and other emergency goods. While discounters saw a surge in sales, purchases slumped at department stores that offer discretionary items like clothing, according to Johnson Redbook data.

Gains were led by “canned food, bottled water, pharmaceuticals, cleaning and household products as consumers stocked up in anticipation of staying at home for the next several weeks,” Bloomberg Intelligence analysts wrote.

It will get even worse for department stores. The largest mall owner, Simon Property Group (NYSE:SPG), announced it was temporarily closing all of its retail malls in the U.S.

3. Jobless Claims

With state and local governments ordering restaurants, movie theaters, bars, gyms and other gathering places to close, economists are bracing for a once-in-a-lifetime surge in jobless claims. Applications for unemployment benefits rose 70,000 last week to 281,000, Labor Department data showed Thursday.

But that’s about to spike much higher. Pantheon Macroeconomics Chief Economist Ian Shepherdson said his preliminary estimate is 2 million claims for next week. Goldman Sachs Group Inc (NYSE:GS). economists project 2.25 million.

4. Consumer Comfort

If you are looking for a bright spot, by one measure, consumers’ attitude seem to be holding up reasonably well. The Bloomberg Consumer Comfort Index improved last week to 63 from 62.7 a week earlier, the first gain since January. The caveat is the CCI is reported on a four-week rolling average basis.



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Confidence remains well above levels of the past recession during 2007 to 2009. But with layoffs starting to occur in large numbers and the stock market deteriorating rapidly, there is reason to expect sentiment will weaken. Improved household attitudes will be vital for spending when the U.S. emerges from the crisis.

5. Movie Theaters

Theaters in the U.S. and Canada brought in just under $50 million over the weekend starting March 13, researcher Comscore Inc. said Monday. That’s a 61% decline from a year earlier and the smallest weekend tally since at least 1998. The three-largest chains in the U.S. are all closed this week, and almost every new film release has been postponed or is being made available for at-home rental early.

Of course, the cinema isn’t alone within the arts and entertainment industry. Broadway is dark too, having been shut down by order of New York Governor Andrew Cuomo more than a week ago. And all major sports — remember this should have been a week for NCAA basketball’s March Madness tournament — have canceled games or suspended seasons indefinitely,












 

Goldman: U.S. Measures Could Support Oil Prices Near Term

Supply restraint by core-OPEC producers could push second-quarter Brent oil prices up to $30 a barrel, while U.S. measures to support the market could underpin prices in the near term, Goldman Sachs (NYSE:GS) said in a research note.

Citing Wall Street Journal reports that the United States was considering intervening in the ongoing Saudi-Russian price war and Texas regulators may curb oil output, the U.S. investment bank said such action would reduce global and U.S. domestic supplies.



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U.S. crude oil prices rose more than $1 on Friday, extending steep gains from the previous session, after U.S. President Donald Trump said he would “get involved” in the price war at an “appropriate time”.

While any U.S. measures could support the oil market into the second half of the year, however, Goldman Sachs said accompanying supply cuts would still not be enough to offset the 8 million barrels per day (bpd) demand loss – brought about by countries slowing economic activity to halt the spread of the coronavirus which has caused nearly 10,000 deaths worldwide.

“Medium-term, the impact of such policies will depend on their political viability given the upcoming presidential election,” Goldman Sachs said in the note issued on Thursday.

U.S. production quotas could create a $5 to $10 upside to Goldman Sachs’ West Texas Intermediate price forecast of $40 to $45 a barrel in 2021, the bank said.

While a return to U.S. oil supply management policies of the 1970s and 80s would “help support prices in the third and fourth quarter above our $30 and $40 a barrel Brent forecast, they would simply replace OPEC’s artificial price support policy with another,” the bank said, referring to the Organization of the Petroleum Exporting Countries, of which Saudi Arabia is a key member.



Oil extends recovery as Trump hints at intervening in Saudi-Russia price war

Oil prices recovered further on Friday, following steep gains in the previous session after U.S. President Donald Trump hinted he may intervene in the price war between Saudi Arabia and Russia at an “appropriate time”.

Prices were also supported by United States’ plans to buy up to 30 million barrels of crude oil for its emergency stockpile by the end of June, while regulators in the country’s largest oil-producing state Texas were reportedly considering curtailing production.

The more active West Texas Intermediate (WTI) crude futures contract for May was up 43 cents, or 1.7% at $26.34 a barrel by 0540 GMT. The contract rose as much as 5.5% to $27.34 per barrel earlier in the session.

U.S. crude futures for April (CLc1) also rose 43 cents to $25.65 a barrel. The front-month April contract, which spiked 24% on Thursday, expires later on Friday.

“An astonishing rebound in crude oil prices overnight was primarily driven by U.S’s consideration to intervene in the oil market by increasing strategic reserves, while slashing some oil production,” said Margaret Yang, market analyst at CMC Markets.

“The underlying issue is that global energy demand is falling sharply as more countries join the ‘lockdown’ club. The severity of Covid-19 for the macro-economy could exceed anyone’s expectation, and it could last for a long period of time.”

Brent crude futures (LCOc1) climbed 28 cents, or about 1%, to $28.75 per barrel.

The international benchmark rose 14.4% on Thursday in its biggest one-day gain since September, but was on track for its fourth consecutive weekly drop on Friday.

U.S. crude and Brent have both collapsed about 40% in the last two weeks since talks between the Organization of the Petroleum Exporting Countries and its allies, including Russia, broke down, which led Saudi Arabia to ramp up supply.

The Trump administration is considering a diplomatic push to get Saudi Arabia to close its taps and using the threat of sanctions on Russia to force them to reduce output, the Wall Street Journal reported, quoting unidentified sources.


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“The outsized gains by WTI reflect the hope and not the reality of the U.S. shale industry. Russia and Saudi Arabia have zero interest in helping US shale survive. Just the opposite, in fact,” said Jeffrey Halley, senior market analyst at OANDA.

“Once this reality finally sets in, I expect the rally in oil to disappear as quickly as it began.”





Stock Market Today: Technology Sector Leads A Turnaround

Stocks turned higher Thursday, erasing losses from earlier in the day as sharp gains in tech shares led to a turnaround. The Dow was up more than 400 points, or 2.1%. The S&P 500 was up 1.5%, while the Nasdaq outperformed with a 3.2% surge. Shares of Netflix and Facebook rose 7.6% and 5.8%, respectively. Amazon gained 4.1%.

Earlier in the session, the Dow was down 721 points, or more than 3%. The S&P 500 briefly fell more than 3% as well.

“This is a day trader’s market,” said Christian Fromhertz, CEO of Tribeca Trade Group. “That’s not my favorite type of trading, but the day-to-day swings and the overnight moves are pretty insane.”

Among the industries trading in positive territory Thursday morning was energy, with the S&P sector up more than 0.5%. Big oil producers like Diamondback Energy and Apache rose more than 8% each as futures contracts tied to the price of West Texas Intermediate crude rallied more than 15% to $23.47, on pace for its fourth-best day ever.







The moves followed yet another violent day on Wall Street on Wednesday. The Dow dropped 1,338.46 points, or 6.3%, on Wednesday and clinched its first close below 20,000 since February 2017. The Dow was down more than 2,300 points at the lows of the session. The S&P 500 dropped 5.2% to 2,398.10 and closed nearly 30% below a record set last month as both indexes sank further into bear markets.

Markets are clearly in a state of panic and forced liquidations – but risks remain skewed to the upside and this should become much more apparent once some of the solvency issues are addressed,” Adam Crisafulli, founder of Vital Knowledge, said in a note.

Wall Street has been on an unprecedented roller-coaster ride amid the coronavirus turmoil, with the S&P 500 swinging 4% or more in either direction for eight consecutive sessions.

An eye-watering spike in Treasury yields has also kept investors anxious. The 10-year Treasury rate hovered at 1.1% after jumping more than 50 basis points in two sessions as it rebounded from record lows.

Gregory Faranello, head of U.S. rates trading at AmeriVet Securities said swift reversal in yields comes amid strong dollar demand amid the coronavirus crisis.

“There’s a dollar strain on the system, globally,” said Faranello. “Whether it’s Asia, Brazil, emerging markets, Europe or here in the U.S., the dollar is in demand right now.”

“If you look at everything across the board, it’s all going down together. The one thing that’s going up that’s dollar denominated is the U.S. dollar,” he added.

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The dollar index, which tracks the greenback’s performance against a basket of other currencies, jumped to its highest level since January 2017 on Thursday. It last traded up 0.7% at 101.83 after breaking above 102.

More central bank stimulus

On Wednesday evening, the European Central Bank (ECB) announced a new Pandemic Emergency Purchase Program that will deploy €750 billion ($819 billion) to purchase securities to help support the European economy. The central bank said purchases will be conducted until the end of 2020 and include a variety of assets including government debt.

The ECB’s action follows similar initiatives by the Federal Reserve, its U.S. counterpart. The Fed announced earlier this month plans to pump an additional $1 trillion into the U.S. economy through asset purchases and cut the federal funds rate to zero. The Fed also said Wednesday night it will create a backstop for prime money market funds.

Those announcements came as the number of confirmed coronavirus cases around the world topped 200,000, according to Johns Hopkins University. In the U.S. alone, more than 9,400 cases have been confirmed along with over 100 deaths.







U.S. lawmakers appeared to inch closer to implementing fiscal stimulus measures. The Senate had enough votes to pass a bill expanding paid leave and unemployment benefits in response to the virus as part of what’s expected to be a whopping governmental response to avoid a downturn.

Senate Majority Leader Mitch McConnell said Wednesday he would vote for the plan despite what he called “real shortcomings.” With the urgent need to take action, “I do not believe we should let perfection be the enemy of something that will help even a subset of workers,” he said.






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New York Stock Exchange Move To Electronic Trading Because Of Coronavirus

The New York Stock Exchange said Wednesday it will temporarily close its historic trading floor and move fully to electronic trading after two people tested positive for coronavirus infection at screenings it had set up this week.



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All-electronic trading will begin on March 23 at the open, the exchange said. The facilities to be closed are the NYSE equities trading floor and NYSE American Options trading floor in New York, and NYSE Arca Options trading floor in San Francisco.

The closure was in part as a result of positive coronavirus tests of two people, Stacey Cunningham, President of the NYSE, told CNBC. The entrants were stopped at the medical screenings at the Big Board.

The stock market has closed at times over the years, such as during World War II and in the wake of 9/11, but this is the first time the physical trading floor of the Big Board has ever shut independently while electronic trading continues.

“We implemented a number a number of safety precautions over the past couple of weeks, and starting on Monday this week we started pre-emptive testing of employees and screening of anyone who came into the building,” Cunningham said on “Closing Bell.” “If that screening warranted additional testing, we tested people and they were sent home and not given access to the building. A couple of those test cases have come back positive.”

“While those people were not in the building this week and the building had been cleaned and addressed prior to start of trading on Monday, I think it’s reflective we’re seeing things evolve,” Cunningham added.

The NYSE is operated by the electronic trading group Intercontinental Exchange, which acquired it in 2012. The exchange moved into its location at 18 Broad St. in lower Manhattan in 1903.



Wall Street has been on an unprecedented volatile ride during the coronavirus crisis. Just this week, a market-wide circuit breaker was triggered twice by the NYSE due to the massive sell-off, resulting in brief trading halts.

On Wednesday, the Dow Jones Industrial Average closed below 20,000 for the first time since February 2017. The S&P 500 was now nearly 30% below a record set last month.

The exchange said in a release that it was implementing its business continuity plan and “trading and regulatory oversight of all NYSE-listed securities will continue without interruption.”





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Amazon Stops Receiving Nonessential Products From Sellers

Amazon is suspending sellers from sending nonessential products to its U.S. and U.K. warehouses until April 5 in the latest move to free up inventory space for much-needed supplies that are in shortage as a result of the coronavirus outbreak.

In a note sent to sellers Tuesday, Amazon said it is seeing increasing online shopping demand from consumers. As its household staples and medical supplies are running out of stock, it will prioritize certain categories in order to “quickly receive, restock, and ship these products to customers.”

Amazon defined five categories as essential products that can continue shipping, including Baby Product, Health & Household, Beauty & Personal Care, Grocery, Industrial & Scientific, Pet Supplies.

The move follows Amazon’s announcement it will hire 100,000 workers for its warehouses on Monday, as the Seattle-based giant is trying to meet growing online shopping need from people who stay home amid the coronavirus outbreak.

Third-party sellers account for over half of the sales on Amazon. Amazon has been courting sellers to use its own fulfillment system, enabling many of them with faster delivery without the risks of sitting on inventories.







It is especially popular for sellers who use a dropping shipping method, meaning sellers import products from manufacturers in countries including China and directly send them to an Amazon warehouse. Amazon earns fees from managing the storage and delivery process.

Sellers supplying products that are deemed nonessential could see their products run out of stock and they will be unable to restock as a result of the measure. Still, they can use other fulfillment methods to directly mail products to customers.

Amazon did not immediately replied to request for comment.



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Traders Bet On Falling ‘Fear Gauge’

The volatility gauge tends to rise when markets fall and investors reach for stock protection through the options market. The VIX climbed to 82.69 Monday, topping its high of about 80 in 2008. After the financial crisis, trading derivatives tied to the VIX took off as people sought to profit from its swings.



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Many are wagering its recent jump won’t be long-lived. Betting on its fall through what is known as the short volatility trade has been particularly popular in recent years. This can be a risky tactic that backfires when stocks slide as sharply as they have in recent weeks as the spread of coronavirus has raised the risk of a recession.

As stock markets staged a modest rebound Tuesday, some of the most popular contracts were tied to VIX falling to 27 or 20, Trade Alert data show, closer to levels hit earlier this year when major indexes hit records.

Still, turbulence in markets has been high, triggering diverging views on the gauge’s path. Analysts at Credit Suisse Group AG said another steep selloff similar to Monday’s could push the VIX above 100. The S&P 500 fell 12% that day, one of the worst sessions in its history.

Some options traders have already been positioning for that, scooping up contracts tied to the VIX jumping as high as 100 or even 130, Trade Alert data show. Those are among the smaller positions outstanding but were some of Monday’s most popular trades, according to Trade Alert.

“While this is surely possible, we believe it is highly improbable,” wrote Jonathan Golub, an analyst at Credit Suisse.

Cboe Global Markets Inc., the exchange operator that oversees VIX options trading has added new strike prices—or levels at which options can be exercised—during the recent market tumult. Cboe added options with a strike of 100 on March 2 and more strikes were added the following week, a spokeswoman for the exchange said.






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Stock Market Today: Wall Street Attempts Rebound From The Dow’s Third-Worst Day Ever

Stock futures and premarket trading in exchange-traded funds pointed to a bounce on Tuesday following the Dow Jones Industrial average’s third-worst day ever.

Trading overnight, however, was very volatile with futures giving back more than 1,000 points as investors try to weigh the uncertain economic impact of the coronavirus outbreak.

Around 6:14 a.m. ET, Dow Jones Industrial Average futures indicated an implied open of more than 400 points. The S&P 500 SPDR ETF gained more than 2% in premarket trading.

Earlier in the session, futures contracts tied to the S&P 500, Dow Jones Industrial Average and Nasdaq 100 hit their upside limit, triggering a halt. In non-U.S. trading hours, stock futures are halted if they hit their downside or upside limits, pinning those contracts to their upper or lower bounds. The halt is meant to ensure that opening trade is orderly and not emotional.




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Those moves came after President Donald Trump tweeted: “The United States will be powerfully supporting those industries, like Airlines and others, that are particularly affected by the Chinese Virus. We will be stronger than ever before!”

The Dow Jones Industrial Average and S&P 500 had their worst day since the “ Black Monday” crash of 1987 , falling 12.9% and 12%, respectively. It was also the Dow’s third-worst day ever. The Nasdaq Composite had its biggest one-day plunge ever, tumbling 12.3%.

Trading halts typically occur amid extremely abnormal market volatility.

The Cboe Volatility Index — Wall Street’s preferred fear gauge — posted its highest-ever close at 82.69 . That tops the financial crisis’ peak of 80.74.

Wall Street’s drop came even after the Federal Reserve slashed interest rates to near-zero on Sunday and announced a $750 billion asset-purchasing program. It also came as the number of coronavirus cases jumped in the U.S.

At least 4,281 cases have been confirmed in the U.S. along with more than 70 deaths, according to data from Johns Hopkins University. President Donald Trump also said the crisis could stretch into August, adding the administration may look at locking down “certain areas.”

“Although the contemporary crisis is loaded with bad news, this has not been its primary problem. It’s the ‘unknown,’” said Jim Paulsen, chief investment strategist at The Leuthold Group, in a note. “Not even health experts understand what this is or where it is headed, and that is the worst possible outcome for investors.”

“Give me bad news any day over complete uncertainty,” he said.

The S&P 500 closed Monday at its lowest level since December 2018. The Dow ended the session at its levels not seen since early 2017.

“For now until there is improvement in the trend … it’s tough to consider being long and it’s right to be in Cash on the sidelines,” Mark Newton, managing member at Newton Advisors, said in a note to clients.



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Wall Street Sees Worst Drop Since 1987

U.S. stock markets fell the most since 1987 in early trading on Monday, having been suspended, limit down, almost immediately after trading started, as the shutdown of increasing swathes of public life in the U.S. brought home the scale of the coronavirus outbreak.

By 9:50 AM ET (1350 GMT), the Dow Jones Industrial Average was down 2,773 points or 12% at 20,393 points. The S&P 500 was indicated down 10.7% and the Nasdaq Composite was down 11.5%.





Investors weren’t reassured by the emergency measures taken on Sunday night by the Federal Reserve, which cut the target range for fed funds to near zero and signalled $700 billion in asset purchases to keep financial markets orderly.

The Fed also said it would extend the availability of dollars internationally through swap facilities with other central banks.

“The Fed has pulled out all the stops. But in the end the underlying driver of this crisis is very different from 2008/9, i.e. this is about COVID-19,” said Robin Brooks, an economist with the Institute for International Finance in Washington, DC. “That means the Fed can alleviate the symptoms, but it’s unreasonable to expect the crisis to go away on Fed action.”

Earlier on Sunday, Treasury Secretary Steven Mnuchin urged investors to look beyond the short-term hit to the economy, telling CNBC that “There will be a huge amount of pent up demand when this is done. And it will be done.”

However, Mnuchin also warned that “the goal is not to bail out companies,” a line that appeared to raise the risk of near-term bankruptcies, especially in the transport and oil sectors.

Among the worst hit were airline stocks. United Airlines stock fell over 15% after saying it would slash capacity by 50%, while Delta Air Lines (NYSE:DAL) stock and American Airlines (NASDAQ:AAL) stock also fell heavily after the Trump administration expanded restrictions on arrivals from Europe to include the key routes serving London and Dublin.

Apple (NASDAQ:AAPL) stock fell as much as 13% before rebounding to be down only 9.7% after the company said it will shut all its stores outside China. It was also hit by a $1.2 billion antitrust fine in France.

Oil and gas stocks tumbled again as crude prices fell below $30 a barrel and U.S. gasoline prices fell to an all-time low of 69 cents a gallon.

Banks were also badly hit, as the Fed’s action threatened to crush lending margins without, at least in the short term, supporting income from currency and securities markets. Bank of America (NYSE:BAC) stock fell 14.6%, while JPMorgan (NYSE:JPM) stock fell 15.1% and Citigroup (NYSE:C) stock fell 19.7%.


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Casino operators MGM Resorts (NYSE:MGM) and Wynn Resorts (NASDAQ:WYNN) also both fell after the pair announced they would temporarily close their casinos in Las Vegas, essentially putting much of the famous strip under lockdown.



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Virus Fears Push Stocks Closer To A Bear Market

The Dow Jones Industrial Average suffered its worst decline since 2008 and at one point came within 65 points of touching a bear market.

For the day, the Dow sank 2,013.76 points, or 7.8%, to 23851.02. It was the first time the Dow lost more than 2,000 points in a session. The S&P 500 fell 225.81 points, or 7.6%, to 2746.56, also its worst day since 2008. And the Nasdaq Composite slid 624.94 points, or 7.3%, to 7950.68.


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All 11 sectors in the S&P 500 were down, led by energy, which slid 20%. Financials were down 11%. Industrials and materials both fell 9.2%.

By day’s end, the Dow, S&P and Nasdaq were all down roughly 19% from record highs set earlier this year. A drop of 20% from those highs would halt a bull-market run that began after the financial crisis. Stocks bottomed out 11 years ago, on March 9, 2009.

The 11-year bull market is over,“ said Peter Cecchini, the chief market strategist at Cantor Fitzgerald, noting that it isn’t just about an official 20% drop.

Mr. Cecchini said central banks suppressed interest rates over the years, and that became a big narrative investors used to justify buying stocks. Meanwhile, signs have emerged that global growth was slowing, like the inverted yield curve late year, but were ignored, he said.

“That underlying backdrop of fragility is one of the reasons why this has unwound so quickly,” he said. “When a bubble extends this far, it doesn’t take much to prick it.”

Saudi Arabia’s decision over the weekend to instigate a price war as it escalates a clash with Russia sent oil prices down by the most since the Gulf War in January 1991. Crude prices, along with U.S. government bond yields, are typically viewed as key barometers of economic health and confidence, said Gregory Perdon, co-chief investment officer at private bankers Arbuthnot Latham.


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“There has always been an assumption that when the oil price collapses the world is going to become a darker place, whether that is driven by the demand side or supply side,” Mr. Perdon said. The latest tensions put the oil market in somewhat uncharted territory with pressure in terms of both supply and demand as the coronavirus epidemic threatens to sap businesses’ appetite for energy.

The plunge in crude added to two weeks of turmoil in equity and credit markets as investors have grown increasingly concerned about economic growth stalling. It also raised fresh concerns about the risks tied to heavily indebted energy companies in the high-yield market, and the fallout for other companies if broader credit markets tighten.

U.S. government bonds, which have already rallied to unprecedented highs, extended gains. The yield on the 10-year Treasury, which moves inversely to bond prices, dropped to 0.577%. The 30-year yield fell below 1%, and more recently was at 1.003%.

“The fear today is about a global recession,” said Thomas Hayes, chairman of Great Hill Capital, a hedge fund-management firm based in New York. “If Russia does not come back to the table soon, investors worry the default risk and credit spreads widening will lead to tighter credit and even a recession.”



Public-health authorities are escalating efforts to contain the coronavirus outbreak, leading to a drop in business activity and curtailing global trade. The number of confirmed coronavirus cases has exceeded 110,000, with over 3,800 fatalities globally. At least eight American states including New York have declared states of emergency as infections spread to new parts of the U.S., and Italy quarantined some 17 million people.

Brent crude, the global gauge of oil prices, shed 18% to $37.19 a barrel, while U.S. crude futures dropped 17% to $34.37 a barrel.

U.S. energy producers were among the hardest hit. Chevron dropped 13% and Exxon Mobil fell 8.3%. Occidental Petroleum slid 33%.

Rising defaults among U.S. energy producers may make it harder for companies in other sectors to access credit markets, analysts said. “That ultimately is the negative aspect to lower oil,” said Viktor Hjort, head of credit strategy at BNP Paribas. “There is a real risk, and that is tighter credit conditions.”

The price war between major oil producers is “throwing petrol on the fire” at a time when investors are struggling to understand how deeply the outbreak will impact global supply chains and consumer spending, according to Lyn Graham-Taylor, a rates strategist at Rabobank.


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“We have got a massive demand decline brought about by the virus and now you’ve got headline inflation going through the floor: all combinations that say we need to do more easing,” Mr. Graham-Taylor said.

Stocks in the European energy sector led markets lower in the region, with BP plummeting 18% in London. Anglo-Dutch firm Royal Dutch Shell, Norway’s Equinor, Italy’s Eni, the U.K.’s BHP Group and France’s Total were also among the big decliners. That led the pan-continental Stoxx Europe 600 index down 6.3% with key equity benchmarks in the U.K. and France entering bear-market territory.

Foreign-exchange markets also faced renewed volatility on Monday, as steep drops in oil sparked a flight from commodity-linked currencies. The Russian ruble lost 7.2%, while the Norwegian Krone dropped 2.5%.

In the Asia-Pacific region, the S&P/ASX 200 index in Australia dropped 7.3%, suffering its worst day since October 2008, during the depths of the global financial crisis. That puts the gauge close to bear-market territory, which is typically defined as a peak-to-trough decline of more than 20%. Japan’s Nikkei 225 index closed down 5.1%, its biggest daily drop since 2016, while the benchmark stock index in Shanghai dropped more than 3%.

The Japanese yen, which often rallies in times of market stress, surged 2.8% to trade below 103 to the dollar, at its strongest levels since 2016. Gold, which is also normally considered a haven asset during times of turmoil, slipped 0.3%.


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“We are in uncharted territory now,” according to Hubert de Barochez, markets economist at Capital Economics. “Up until last week, what we were seeing was bond yields lower, stocks hurt and riskier currencies getting hit, but the idea was that if good news were to come all these moves would revert.”

The question now is where markets—and especially interest rates—go from here, said Dan Alpert, an investment banker and managing partner of advisory firm Westwood Capital.

“I cannot believe, that now that confidence in the market has been destroyed, that interest rates remain at 0.4%,” he said, referring to the rate on the 10-year yield. What’s more likely, he said, is a period of disinflation, or even outright deflation, that would ripple across markets and economies.

That will hurt companies, he said, especially those that are suffering in the current selloff. Firms will be talking about conserving resources, which could affect factors ranging from buybacks to wages, he said. That would cut into employment and consumer demand, he said.

“This is going to change the entire inflationary outlook,” he said.


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China January-February Exports Tumble




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China’s exports contracted sharply in the first two months of the year, and imports slowed, as the health crisis triggered by the coronavirus outbreak caused massive disruptions to business operations, global supply chains and economic activity.

The gloomy trade report is likely to reinforce fears that China’s economic growth halved in the first quarter to the weakest since 1990 as the epidemic and strict government containment measures crippled factory production and led to a sharp slump in demand.

Overseas shipments fell 17.2% in January-February from the same period a year earlier, customs data showed on Saturday, marking the steepest fall since February 2019.

That compared with a 14% drop tipped by a Reuters poll of analysts and a 7.9% gain in December.

Imports sank 4% from a year earlier, but were better than market expectations of a 15% drop. They had jumped 16.5% in December, buoyed in part by a preliminary Sino-U.S. trade deal.

China ran a trade deficit of $7.09 billion for the period, reversing an expected $24.6 billion surplus in the poll.

Factory activity contracted at the fastest pace ever in February, even worse than during the global financial crisis, an official manufacturing gauge showed last weekend, with a sharp slump in new orders. A private survey highlighted similarly dire conditions.

The epidemic has killed over 3,000 and infected more than 80,000 in China. Though the number of new infections in China is falling, and local governments are slowly relaxing emergency measures, analysts say many businesses are taking longer to reopen than expected, and may not return to normal production till April.

Those delays threaten an even longer and costlier spillover into the economies of China’s major trading partners, many of which rely heavily on Chinese-made parts and components.

China’s trade surplus with the United States for the first two months of the year stood at $25.37 billion, Reuters calculation based on Chinese customs data showed, much narrower than a surplus of $42.16 billion in the same period last year.

Soybean imports in the first two months of 2020 rose by 14.2% year-on-year as cargoes from the U.S. booked during a trade truce at the end of 2019 cleared customs.

After months of tensions and tariff hikes that dragged on bilateral trade, the world’s two biggest economies agreed an interim trade deal in January that cut some U.S. tariffs on Chinese goods in exchange for Chinese pledges to massively increase purchases of U.S. goods and services.

The U.S. expects China to honor these commitments despite the coronavirus outbreak, a senior U.S. official said in February.

VIRUS THREATENS GLOBAL RECESSION

The supply and demand shocks in China are likely to reverberate through global supply chains for months, and the rising number of virus cases and business disruptions in other countries is raising fears of a prolonged global slowdown or even recession.

In response, global policymakers have stepped up efforts to cushion the economic blow of the epidemic, with the U.S. Federal Reserve delivering an emergency rate cut last week.

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Shortages of vital parts and components from China last month cost other countries and their industries $50 billion, a United Nations agency said on Wednesday.

The virus outbreak escalated in late January just as many businesses were winding down operations or closing for the long Lunar New Year holidays, and as hundreds of millions of Chinese were returning to their hometowns.

China customs said last month it would not release separate figures for January and would combine January and February instead, in line with how some of the country’s other major indicators are released early in the year, which is intended to smooth distortions created by the holidays.

Tough public measures such as restrictions on travel and quarantines meant many of these people were unable to return to their jobs in offices, factories and ports until only recently.

Some firms which have reopened have faced shortages of parts and other raw materials as well as labor, while others report inventories of finished goods such as steel are piling up as downstream customers like car plants slowly crank up production again.

Iron ore imports rose 1.5% over the first two months, supported by firm demand at steel mills even though the coronavirus outbreak had disrupted downstream sectors.

Parts of central Hubei province, the epicenter of the outbreak and a major transport and manufacturing center, are expected to remain under lockdown well into March.

Analysts at Nomura estimate only 44% of the businesses worst affected by the outbreak had resumed operation as of March 1, and 62.1% across the economy as a whole. As such, they forecast economic growth will slump to 2% in the first quarter year-on-year, from 6% in the previous quarter.

Beijing has already stepped up support measures, including offering cheap loans to affected businesses, and policy sources have told Reuters that more steps are expected as authorities try to cushion the epidemic’s impact on the economy.

China’s commerce ministry said on Thursday that more than 70% of foreign trade companies in the coastal provinces have resumed work.

But financial magazine Caixin reported this week that some companies were keeping machines running and lights open throughout the day even though they have no goods to produce, in a bid to allow managers and local officials to inflate the official work resumption rate. Reuters wasn’t able to verify this report.




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Market Turbulence: Investors Sell Bonds And Bank Stocks In Europe On Fears Of A Deeper Slowdown

The market rout in stocks spilled into the corporate-debt markets Friday after investors began to more fully assess the harm that prolonged economic disruption from the coronavirus could do to highly indebted companies.

Reaction to the virus had been relatively muted in credit markets, where yields on even riskier junk bonds and loans had remained below levels seen during the selloff in late 2018. However, data on Thursday showed accelerating withdrawals from U.S. high-yield bond and loan funds in the past week, which was followed by a drop in European bank stocks driven by investors’ concerns over loan losses.

In Europe, the cost of protection on risky corporate credit jumped to its highest level in nearly four years on the leading IHS Markit index of riskier credit derivatives, the iTraxx Crossover. The cost rose to more than €388,000 ($436,000) annually to cover €10 million of bonds.

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This followed a sharp rise in the U.S. CDX High Yield index, showing that it cost more than $409,000 annually to protect $10 million of bonds at the close on Thursday. The price of a BlackRock Inc. exchange-traded fund that often serves as a proxy for the high-yield market—known by its ticker symbol HYG—fell to about $84.68 from $86.02 Thursday.

While selling was broad-based, bonds of companies in sectors that could be most affected by the spread of the coronavirus, such as travel and energy, fell especially sharply. The yield investors demanded to hold short-term bonds of American Airlines Group Inc. jumped as high as 12.4% from 5% earlier in the week, with prices falling as low as 86 cents on the dollar from 92.75 cents Thursday, according to MarketAxess.

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Amid a steep decline in oil prices, a Laredo Petroleum Inc. 9.5% bond due in 2025, which was issued at par in January, fell to 57.5 cents on the dollar from 69 cents Thursday.

Friday’s selling is notable because credit markets are critical to the functioning of the economy. Earlier this week, companies of varying credit quality were still issuing bonds, and the average yield of U.S. speculative-grade bonds remained below levels from last summer, according to Bloomberg Barclays data. But extended volatility could make it difficult for companies to borrow, exacerbating any economic hit from the coronavirus.

Today was the day when it flipped from equity market leadership of the selloff to credit market leadership,” said Barnaby Martin, head of European credit strategy at Bank of America Merrill Lynch. “We were building up vulnerabilities…this is what happens when the market reaches for yield, which is hubris.”

The rush to buy protection and withdrawal from bonds was driven by dedicated credit funds being forced to cut back positions, amplified by a lack of liquidity in the markets, according to one senior credit trader in London.

This follows a wave of withdrawals from U.S. funds that invest in riskier credit, according to LCD, the loan research arm of S&P Global Market Intelligence. More than $5 billion was pulled from U.S. high-yield bond mutual funds and exchange-traded funds in the week to March 4, up from $4.2 billion the week before, according to Refinitiv Lipper. There had been net inflows, year to date, before last week.

Funds that invest in risky loans, typically used to fund private-equity-backed companies, have also seen growing outflows, with $2.3 billion pulled in the week to March 4, bringing the total outflow over the past seven weeks to $4.7 billion, according to LCD.

After two weeks of equity market declines, corporate debt investors and analysts are growing more concerned about how economic disruption brought about by the coronavirus will hurt the cash flow and the credit quality of weaker companies, and particularly of smaller companies that typically have less capacity to bridge a drop on cash flows.

This is also one reason why bank stocks are getting hit, particularly in Europe, where there is already wide disruption to travel and one U.K. airline has been pushed into insolvency. The Euro Stoxx Banks index has dropped 7.5% in the past two days and is now down 24% since cases were reported in Italy in late February.

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Some analysts are now beginning to worry more about highly indebted businesses, and where exposures to them lie through the system of investment funds and structured products known collectively as the shadow banking sector.

“We are concerned that there are skeletons out there in closets we may not be aware of that come out in times like this, particularly leverage from the shadow banking system,” John Briggs, head of Americas strategy at NatWest Markets in New York, wrote in a Friday morning note. “I also worry about the small and medium sized businesses in particular.”





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Coronavirus Cases Globally Exceed 100,000 As Countries Fail To Contain Spread

There were 100,329 confirmed cases of the virus world-wide, more than a fifth of which were in countries other than China, according to data compiled by Johns Hopkins University. South Korea, the second worst-hit country, reported another jump in infections, bringing its tally to 6,593. The novel coronavirus is now in around 90 countries, less than three months after it was first identified in the central Chinese city of Wuhan in December.

Chinese health authorities on Friday reported 143 new infections, but said that for the first time there were no new cases in the wider Hubei province outside of its capital of Wuhan in the previous day. The vast majority of China’s 80,555 cases have been in Hubei province, and authorities in late January locked down Wuhan and neighboring cities to help contain the disease’s spread.

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Globally, 3,406 individuals have died from the illness known as Covid-19 and 55,694 have recovered. In the U.S., there have been 233 confirmed cases and 12 deaths, mostly in the state of Washington, where some schools in the Seattle area will be closed for two weeks and companies have told employees to work from home.

On Friday, a top Hong Kong university released research that surmised the “fatality risk” for symptomatic Covid-19 patients was 1.4%, based on data its researchers analyzed from the city of Wuhan.

That is lower than the 3.4% mortality rate cited earlier this week by the World Health Organization, which was calculated from the number of deaths relative to the total number of confirmed infections.

U.S. health officials, in contrast, have said they think the mortality rate for the novel coronavirus is likely between 0.1% and 1%, in part because there could be many unreported cases or asymptomatic carriers of the virus.

Gabriel Leung, dean of the Li Ka Shing Faculty of Medicine at the University of Hong Kong, said that the estimated 1.4% mortality rate among people who showed symptoms means Covid-19 is deadlier than the 2009 swine flu epidemic, though less so than the 1918 influenza pandemic.

And given the large and rising global tally of coronavirus infections, “that means a lot of lives,” he added.

Dr. Leung’s organization—which is a WHO Collaborating Center for Infectious Disease Epidemiology and Control—calculated the disease’s mortality rate from its own estimates of how many people in Wuhan had symptoms of the disease before Feb. 25, rather than using case numbers reported by the Chinese government, which some experts suspect are understated. During the period they studied, there were 2,080 reported deaths.

On Friday, global stocks fell again and investors piled into safe government bonds on rising expectations that central banks will take more decisive action to cushion the economic blow from the coronavirus epidemic.

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A day earlier, a top WHO official warned that many countries weren’t doing enough to help contain the epidemic. Tedros Adhanom Ghebreyesus, the WHO’s director general, said that while the bulk of coronavirus cases are currently concentrated in a few countries, other governments need to respond more forcefully to the global spread by activating emergency plans, educating the public, readying hospitals and increasing their capacity for testing for the virus.

“This epidemic can be pushed back, but only with a collective, coordinated and comprehensive approach that engages the entire machinery of government,” Mr. Ghebreyesus told a briefing at the U.N. health agency’s Geneva headquarters late Thursday. “This is not a drill,” he added.

Other countries in Asia reported higher case numbers on Friday. Japanese authorities said there were 31 new cases, taking the country’s total to 348. Of those, 35 showed no symptoms.

A report from the Asian Development Bank on Friday estimated the coronavirus epidemic could reduce the world’s economic output by $77 billion-$347 billion, or 0.1%-0.4%, of global gross domestic product.

It said the virus will have a significant impact on developing Asian economies through numerous channels, including sharp declines in domestic demand, lower tourism and business travel, trade and production linkages, supply disruptions and health effects.






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Financial Markets – Investors Retreat From Stocks

Investors continued to pile into safe-haven assets Friday, pushing the yield on long-term U.S. government bonds to unprecedented levels and setting gold up for its best week in over a decade.





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The yield on the benchmark 10-year Treasury sank below 0.8% for the first time. Stock futures also retreated, with contracts linked to the Dow Jones Industrial Average declining 2.3%, pointing to a decline of over 600 points when the blue-chips index opens for trading in New York. On Thursday, all three major U.S. stock indexes had retreated more than 3%.

Oil prices added to the market turmoil Friday, with the global benchmark, Brent crude, declining 3.8% to $48.09 a barrel. Russia disagrees with OPEC’s preliminary agreement Thursday to cut output by 1 million barrels a day, The Wall Street Journal reported. OPEC members and their allies, led by Russia, are continuing to meet Friday in Vienna. Brent has declined 27% since the beginning of the year as the coronavirus has hammered demand.

The pan-continental Stoxx Europe 600 gauge also dropped 3.4% to its lowest level since August. Asia’s major equity benchmarks closed lower Friday, with the Shanghai Composite Index losing 1.2%.

“People are accepting the size of the crisis: they know the governments are doing the right thing but what your brain tells you logically isn’t always how you feel about something emotionally,’’ said Sebastien Galy, a senior macro strategist at Nordea Asset Management. NDA.FI -4.02% “We’re seeing the market’s emotional brain leading today.”

Investors sought out assets that are considered low in risk — such as government bonds and gold — on worries about the economic impact of the coronavirus. The yield on 10-year Treasurys slipped to 0.755%, after earlier notching a record intraday level of 0.701%. It had closed Thursday at 0.924%. The yield on the 30-year benchmark dropped to 1.352%.

The continued market jitters — even after the Federal Reserve unexpectedly cut rates and U.S. lawmakers approved roughly $8 billion in emergency spending — is focusing attention now on potential government measures to counteract the economic impacts of the coronavirus. But President Trump and White House officials have said they don’t see an immediate need to craft a broader fiscal-policy response because the economy has been faring well.




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Futures markets suggest the Fed’s key rate is likely to be in a range of just 0.25% to 0.5% by the end of April. That would be just 0.25 percentage points higher than the near-zero level that held from the depths of the global financial crisis until December 2015.

Investors are expecting rate cuts now and they are expecting [the cuts] to persist in the next two to three years,” said Homin Lee, Asia macro strategist at Lombard Odier. He said markets were pricing two to three further interest-rate reductions this year, and that these moves would only be partially reversed in the next three years.

Safe-haven assets gained, with the Japanese yen rising 0.9% against the dollar. Gold also rose 0.9%, and is on track for its best one-week performance since December 2008.

The ICE Dollar Index, which tracks the U.S. dollar against a basket of six major currencies, dropped 0.9% Friday.

Later in the day, the U.S. jobs report for February will offer fresh insights into the health of the U.S. economy before the coronavirus epidemic started to affect business activity. Economists surveyed by The Wall Street Journal are expecting 175,000 jobs to have been added last month and for the unemployment rate to be at 3.5%, a 50-year low.

The U.S. Commerce Department will also release data on the trade deficit, which is expected to have fallen to $46 billion in January from $48.88 billion the previous month.


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OPEC Agrees To Drastic Oil Cuts

The plan approved Thursday by the Organization of the Petroleum Exporting Countries would involve production cuts of 1 million barrels a day through the end of June to be shared among its 13 member nations. It also calls for another 500,000 barrels of daily cuts to be divided among the cartel’s 10 Russia-led oil-producing allies.

OPEC earlier in the day had agreed to only a three-month cut. But Saudi Arabia decided it wanted to force Russia into a more ambitious effort. Other OPEC members worried that the plan announced earlier in the day had failed to stimulate flagging prices, cartel delegates said.

“It’s a gamble,” one delegate said.

Brent crude, the global benchmark oil price, ended the day down 2.2%.

The production cuts would come on top of 500,000 barrels a day of existing curbs, which OPEC has agreed to carry through the end of the year, the cartel said. Saudi Arabia and other Persian Gulf producers are also considering additional production cuts outside the group, delegates said.

The coronavirus’s impact on oil demand has weighed heavily on recent talks among members of the so-called OPEC+ alliance led by Saudi Arabia and Russia. Brent is down 23% so far this year, as the virus outbreak hammers global demand.

The epidemic is expected to diminish global crude demand by as much as 2.1 million barrels a day in the first half of 2020, according to an estimate from Goldman Sachs. Meanwhile, IHS Markit and Standard Chartered forecast a decline in demand for 2020’s first two quarters by around 2 million barrels a day from the same period a year earlier. Gulf nations’ additional cuts would take OPEC+’s cuts to 2.1 million barrels a day.

“It’s not just about bleeding demand growth,” said Mohammad Darwazah, director for geopolitics and energy at Medley Global Advisors. “We’ve had inventories building through this whole period and it’s about cleaning up the market and 2.1 [million barrels in cuts] would go a long way to reversing these builds.”

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The OPEC plan needs the approval of Russia and other non-OPEC allies, which are set to weigh the proposal on Friday. Russia has agreed in principle to reduce its output but hasn’t approved any production figure, OPEC officials said.

“Tomorrow, everything depends on a non-OPEC agreement,” Iran’s oil minister, Bijan Zanganeh, told reporters as he exited the meeting. “If [Russia] doesn’t accept it, we have no deal…We have no plan.”

Russian Energy Minister Alexander Novak refused to endorse the Saudi-backed plan at a technical meeting Wednesday and flew back to Moscow to consult with President Vladimir Putin, according to OPEC delegates. Mr. Novak also wants Russia to increase output this summer, a move that contradicts the cartel’s nine-months plan, according to one delegate.


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An OPEC official who attended Wednesday’s gathering said Moscow’s delays are negotiation tactics aimed at securing a deal that would have Russia cut relatively little. Russia is now seeking cuts of about 100,000 barrels a day, leaving Saudi Arabia to bear the brunt of the reduction effort, OPEC officials said.

Russia’s hard bargaining is increasingly wearing down Saudi Arabia and its Gulf allies, casting a cloud on the future of their four-year alliance. “Maybe it’s time to consider the whole point of non-OPEC,” said one Persian Gulf official.

The Saudis’ commitment to carry the bulk of the cuts on their own could lead to further complacency among OPEC nations, some of which have historically flouted production cut agreements.

“The Saudis want collective action, and going above and beyond means they may only encourage more free-riding,” said Medley Global Advisors’ Mr. Darwazah.

Oil prices swung higher following the news that Saudi and its Gulf neighbors were considering their own additional cuts, before quickly reversing those gains.





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U.S. Stocks And Bond Yields Dropped As Anxiety About Virus Fallout Returns

The Dow Jones Industrial Average fell more than 650 points, or 2.5%, erasing much of the gains notched Wednesday. A strong Super Tuesday performance by former Vice President Joe Biden and growing signs of a coordinated response to the coronavirus had led to a sharp rally in U.S. stocks.

That enthusiasm quickly dissipated Thursday. The S&P 500 fell 2.3%. The Nasdaq Composite shed 1.8%. Losses in the stock market were broad, with all 11 of the S&P 500’s sectors falling in early trading Thursday.



It has been a dizzying week on Wall Street. Sharp stock swings up and down have dominated the week, continuing a bout of volatility that led to the worst selloff since the financial crisis last week.

“I know that these wild swings are overwhelming for all of us,” said Amy Kong, chief investment officer at Barrett Asset Management. “The situation is still unfolding.”

Still, some investors said they expected the stock market gyrations to continue, with much remaining unknown about how far the coronavirus will spread and its ramifications on economic growth around the globe.

In recent days, the outlook for corporate earnings and economic growth this year has darkened, weighing on the stock market. Many have been worried that the virus will harm consumer sentiment and business investment around the world.

Investors will analyze fresh economic data this week for signs of wilting growth. Data on Thursday showed that U.S. factory orders fell in January. New orders for manufactured goods decreased 0.5%, the Commerce department said, more than what economists surveyed by The Wall Street Journal had expected.


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On Friday, investors will be parsing the monthly jobs report to see if U.S. hiring remained strong in February. The number of Americans applying for first-time unemployment benefits fell last week, the Labor Department said Thursday, suggesting anxiety about the spread of the coronavirus haven’t yet affected layoffs.

The early stock decline Thursday suggests that steps by the Federal Reserve and U.S. lawmakers this week to bolster economic growth are failing to assuage investors.

Health authorities are warning that it may be impossible to fully contain the pathogen as infections are spreading within many communities. Meanwhile, steps taken to halt the outbreak have curtailed travel and business activity in the epicenters of the disease.

“There is a sense that there is only so much monetary policy can do, given markets have priced that in already,” said Jonas Goltermann, senior markets economist at Capital Economics. “Even with all the stimulus measures, those are not going to stop the virus and until there are signs the rate of infection is slowing we don’t think there will be a sustained rally.”

Investors are betting on more interest-rate cuts later this year, CME Group data show.

As stocks fell, investors sought the relative safety of government bonds, pushing the yield on the benchmark 10-year U.S. Treasury note down to 0.930%, from 0.994% at the close on Wednesday. Yields fall as bond prices rise.

The falling yields reflect high anxiety in markets as investors seek traditionally safer investments. They also have wide-ranging effects on borrowing costs and bank profitability. Shares of financial companies were some of the hardest hit in the stock market Thursday. Falling yields can crimp profits for big banks.

Meanwhile, mortgage rates fell to their lowest level on record Thursday as yields fell.

European stocks also fell, with the pan-continental Stoxx Europe 600 index down 1.6%. The basic resources sector and aerospace and defense companies were among the hardest hit.

U.S. stocks are poised to remain turbulent with the Cboe Volatility Index, or VIX, climbing to over 35. The index, sometimes known as Wall Street’s fear gauge, last week topped 40 to hit its highest level since 2011.
With volatility elevated and gauges of investor confidence low, markets are likely to keep swinging, according to Olivier d’Assier, head of applied research for the Asia-Pacific region at financial analytics firm Qontigo.

“We are going to be stuck in this for a while” Mr. d’Assier said. “You’ve got short-term traders buying on the stimulus and then you have medium- and long-term investors de-risking.”

Investor sentiment had shown signs of improvement Wednesday after U.S. lawmakers passed an $8 billion-emergency spending package on Wednesday to combat the coronavirus. Meanwhile, the International Monetary Fund detailed the $50 billion in lending programs it has that could help countries grappling with the virus.

Travel and leisure stocks continued to take a beating. Cruise line operator Norwegian Cruise Line Holdings fell about 9.8%, while Royal Caribbean Cruises dropped 12% as travelers continue to back out of planned cruises because of virus fears. American Airlines retreated 8.4%.

In contrast, most Asian markets rose Thursday, with the Shanghai Composite Index and Hong Kong’s Hang Seng Index both closing up around 2%.
Eli Lee, head of investment strategy at Bank of Singapore, said he viewed recent market action as noise. “The rebound is the latest in a series of gyrations we’ve seen, and reflects the fact equities were likely oversold,” he said.


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Mr. Lee said a coordinated international monetary and fiscal response would help boost financial conditions and investor sentiment, but added: “These are ultimately very blunt tools against a medical crisis that is poised to cause a sharp shock to consumer demand and production.”

In commodities, Brent crude, the global oil benchmark, wavered between gains and losses before edging down 0.6% in recent trading. OPEC has reached a preliminary agreement to cut crude output amid a global glut and eroding demand, The Wall Street Journal reported, as members of the oil-exporting group and their allies gather for a two-day meeting in Vienna. The collective plan, in response to the virus outbreak, still needs to be approved by Russia.

“In order for this to succeed, they need Russia to be onboard or they would just pass over market share to a major competitor,” said Ole Hansen, head of commodity strategy at Saxo Bank.





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Coronavirus Fears Hammer Europe’s Tourism Industry

The long line to get into St. Peter’s Basilica in Rome is gone. The coronavirus outbreak in Europe is scaring away travelers and hammering tourism just as the high season is getting under way.

Thousands of people have canceled their trips to the region since the disease began to spread in Italy last month, drying up revenue for hotels, restaurants, nightclubs and conference planners across the continent. Those businesses are the economic lifeblood of many regions in Europe, clustered around its famed cultural attractions. The outbreak is costing the European Union’s tourism industry €1 billion ($1.1 billion) a month, said Thierry Breton, the EU’s internal market commissioner.

“It gets worse and worse. The cancellations are piling up,” said Franck Trouet, spokesman for France’s Group of Independent Hoteliers and Restaurateurs. A third of its members have seen their revenue fall in February compared with a year ago, when business was already suffering because of the yellow-vest protests in France. In Paris, some cafes and nightclubs have seen a 40% drop in sales, he said.

Authorities around the world have told people not to travel to northern Italy, the site of Europe’s largest outbreak. That warning, however, is having a ripple effect far beyond the canals of Venice.

“The damage this is causing has the potential to be way out of proportion to the threat posed by the virus,” says Tom Jenkins, chief executive of ETOA, which represents European tour operators.


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The outbreak comes at a particularly bad time for the industry: The start of the period when people book their spring and summer travel plans. That includes pilgrims coming to the Vatican for the Holy Week leading up to Easter Sunday, and tourists from the U.S. and Asia coming to the continent over summer vacation.

Flight bookings to Europe the last week of February, when the Italian outbreak emerged, fell 79% compared with the same period a year earlier, according to ForwardKeys, which tracks travel data. In Italy, cancellations have exceeded new bookings over that time, the firm said.

The Louvre reopened Wednesday after closing for several days, because staff refused to work. They were spooked by the French government’s decision to ban indoor gatherings of more than 5,000 to contain the spread of the virus. The museum, which is the most visited in the world, welcomes more than 26,000 visitors on a typical day.

Given bottles of hand sanitizer by management, staff were back at work, watching small groups of visitors drift through the museum. The Dutch masters section—stocked with Rembrandts and Vermeers—was nearly empty. Michelangelo’s “Slaves” sculptures weren’t surrounded as usual.

And inside the room housing the Mona Lisa, there was plenty of space to gaze at Leonardo da Vinci’s masterpiece and other paintings of the Italian Renaissance.

“Normally, you almost don’t see the paintings there are so many people,” says Luis Filipe De-Souza, an attendant at the Louvre.


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The Vatican is facing a sharp drop in visitors to the Vatican Museums, which bring in €40 million in profit in a normal year and are a key revenue source for the church. Vatican officials declined to comment on a report in an Italian newspaper saying the museums had experienced a 60% drop in attendance.

Organizers of ITB Berlin, the travel industry’s main annual conference, announced last week that they had canceled the meeting because of the coronavirus outbreak. German health authorities feared the event, which draws tens of thousands of people from around the world, could lead to a spike in cases in the country.

The cancellation has led to grumbling that the travel industry itself is feeding into global panic about the virus.

“It sends a dreadful signal,” said Mr. Jenkins, head of the tour operators’ group.





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Australian Economic Growth Picks Up But Outlook Cloudy On Virus Fears

Australia’s economy expanded by more than expected last quarter, erasing the risk of a recession even as raging bushfires and the coronavirus crisis wreaked havoc with tourism and travel at the start of the new year.

Wednesday’s data from the Australian Bureau of Statistics (ABS) showed the A$2 trillion ($1.3 trillion) economy accelerated by 0.5% last quarter. Encouragingly, the previous quarter was revised upwards to show 0.6% increase from 0.4% earlier.

That took the annual pace to 2.3%, still well below the 2.75% that policy makers consider “trend”.

Economists had predicted a quarterly rate of 0.3%, according to a median of 16 economists polled by Reuters.

The stronger-than-expected data sent the local dollar rising 0.4% to $0.6611 from $0.6577 before.

The outlook is murkier though, as the coronavirus epidemic is seen dealing a greater blow to world economies than earlier expected.

Such are the risks that the Reserve Bank of Australia (RBA) cut interest rates to an historic low of 0.5% this week, just part of an urgent global response to the virus that saw the Federal Reserve spring an emergency policy easing.


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Prime Minster Scott Morrison has also flagged an imminent burst of targeted fiscal stimulus, a major u-turn for the conservative government that has long scorned such action.

“We view this shift in fiscal policy as a very positive development, but still expect further support from the RBA will be required given the extent of the shock and since the economy was underperforming prior to the outbreak,” said Alan Oster, chief economist at NAB.

He sees another quarter point rate cut in April and suspects the central bank would then have to consider quantitative easing including buying government bonds.


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#1 – The Intelligent Investor. (Revised Edition)

This classic text is annotated to update Graham’s timeless wisdom for today’s market conditions… The greatest investment advisor of the twentieth century, Benjamin Graham, taught and inspired people worldwide. Graham’s philosophy of “value investing” — which shields investors from substantial error and teaches them to develop long-term strategies — has made The Intelligent Investor the stock market bible ever since its original publication in 1949.

Over the years, market developments have proven the wisdom of Graham’s strategies. While preserving the integrity of Graham’s original text, this revised edition includes updated commentary by noted financial journalist Jason Zweig, whose perspective incorporates the realities of today’s market, draws parallels between Graham’s examples and today’s financial headlines, and gives readers a more thorough understanding of how to apply Graham’s principles.

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Federal Reserve Delivered A Half Percentage Point Rate Cut Tuesday, But Markets Slumped On The News

The Federal Reserve’s extraordinary rate cut Tuesday is likely only the first of multiple efforts to stem fear over the threat the coronavirus poses to global growth and financial markets.

No sooner had the U.S. central bank announced a half percentage point reduction than market participants began speculating about what was next. Wall Street broadly expects the Fed to follow up with another cut in a few weeks followed by more monetary easing in April.

In fact, if reaction from Tuesday’s move is any indication, it will take a lot more for the Fed to assuage heightened worries over a virus-induced threat to the longest expansion in U.S. history.

“The question from here is what further adjustments do they make,” said Bill English, former head of monetary policy for the Fed and now a professor of finance at the Yale School of Management. “The answer to that is when their outlook for the economy changes, it may be appropriate to do something more. That’s going to be a hard thing to communicate over the next few months.”

Markets, indeed, will be demanding more action even if the coronavirus damage doesn’t show up in the data.

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A Powell letdown
Fed Chairman Jerome Powell sought to quell some anxiety Tuesday when, during a news conference after the cut, he said he and the Federal Open Market Committee are “prepared to use our tools and act appropriately, depending on the flow of events.”

The market didn’t like it, though, and sold off sharply during and after his comments.

One source of disappointment may have come when Powell indicated that he doesn’t foresee the Fed expanding its balance sheet through asset purchases — quantitative easing — in response to current conditions.

“What they should have done is said we’re going to do whatever it takes,” said George Selgin, director of the Cato Institute’s Center for Monetary and Financial Alternatives. “It’s the path forward that’s more important than the step taken immediately.”

The “whatever it takes” approach would echo then-European Central Bank President Mario Draghi’s promise in 2012 to pull out all the stops to address the Continent’s debt crisis. The pledge was widely seen as helping to stem a panic that the euro zone was about to sink into a deep recession.


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Selgin said the Fed should have taken a similar approach, with adopting just a quarter-point cut but with a vow that it would deploy all its tools to make sure the coronavirus situation doesn’t create greater havoc.

“It was fine for the Fed to act immediately. But the less it does now in the way of actual cuts and the more it signals its willingness to make further cuts if necessary with clear goals of what ‘necessary’ means, it would have been all the better,” he said. “For one thing, you don’t want to waste your ammunition.”

Cuts in March and April
Indeed, with Tuesday’s announced cut the Fed now only has another percentage point, or 100 basis points, left to go. And Wall Street expects the central bank not to waste time in using up that remaining space.

Both Citigroup and Bank of America Global Research expect the Fed to do at least 25 basis points more at the March meeting. BofA sees another similar reduction in April; Citi sees either 50 basis points in March or 25 basis points in each month.

“Further cuts may be more controversial as some on the committee will want to wait-and-see how the 50bp (and 75bp from last year) work their way through the economy,” Citigroup economist Andrew Hollenhorst said in a note. “But either soft data or tighter financial conditions will likely convince most to cut further.”

Communicating further action will be complicated.

Tuesday’s emergency reduction was met with a sharp rally on Wall Street that quickly evaporated. Major indexes suffered losses in excess of 2% and the benchmark 10-year Treasury note yield fell below 1% for the first time ever.



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A fearful Fed
While markets wanted policy easing, the execution didn’t go very well.

“The communication of this stuff is always hard. No one ever knows what markets are thinking and doing,” English said. “But partly the lack of [positive] effect today is that maybe people thought they learned that the Fed was more worried than they thought.”

Cleveland Fed President Loretta Mester entered the conversation later in the day, saying during a speech in London that she thought the cut would help but noted that actions from other officials, particularly on the fiscal side and in health care, “would likely do more to support confidence and spending by helping to contain the spread of the virus.”

She did not indicate whether she would support further easing.

That decision will come down to the evaluation of a number of factors that will go behind the stock market and economic reports, which operate on a lag and don’t always represent current conditions, said Lou Crandall, chief economist at Wrightson ICAP.

“They do need to see more evidence of actual concrete distractions to the business environment,” Crandall said. “If the contours of the virus impact on the U.S. economy become more clear, a rate cut won’t solve all our problems, but it will be helpful.”


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World Finance Officials To Consider How To Cushion Economies Against Coronavirus

G7 finance officials will on Tuesday discuss ways to bolster their economies against the impact of the spreading coronavirus outbreak, but are not expected to specifically call for new spending or coordinated interest rate cuts, a G7 official said.


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Finance ministers and central bank governors from the group will hold a conference call at 1200 GMT to discuss the outbreak. But according to the official, who declined to be identified, a statement they are crafting does not detail any fiscal or monetary steps

Global stocks and oil prices have made some recovery afters policymakers indicated willingness to help ease the economic fallout from the coronavirus, while worries about the outcome of the Group of Seven heads’ discussion kept a lid on gains.

“This is a tug of war between hope and fear. Central banks are giving hopes with their potential stimulus,” said Vasu Menon, senior investment strategist at OCBC Bank Wealth Management.

“The question is what they will do? Monetary policy is already very loose and interest rates are very low,” he said.

Global stocks suffered a rout last week on growing fears that the disruption to supply chains, factory output and global travel caused by the epidemic could deal a serious blow to a world economy trying to recover from the U.S.-China trade war.

The G7 official, who has direct knowledge of the deliberations, told Reuters the officials would pledge to work together to mitigate the damage to their economies from the fast-spreading epidemic.

The language of an expected statement was subject to change as it was under discussion, the official said.

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The coronavirus, which emerged in the central Chinese city of Wuhan late last year, has spread rapidly around the world over the past week, with more new cases now appearing outside China than within.

There are more than 90,000 cases globally, with more than 80,000 of them in China, and infections appearing in 77 other countries and territories, with Ukraine the latest country to report its first case.

China’s death toll is at 2,943 with more than 75 deaths elsewhere.

New cases in China have been falling sharply, with 125 reported on Tuesday, thanks to its aggressive measures to stop the spread of the disease.

After what critics said was an initially hesitant response to the virus, China imposed sweeping restrictions, including suspensions of transport, sealing off communities affecting tens of millions of people, and extending a Lunar New Year holiday across the country.

QUARANTINE ORDERS

Now China is increasingly concerned about the virus being brought back into the country by its citizens returning from new hot spots elsewhere, and authorities on Tuesday asked overseas Chinese to reconsider or minimize their plans to travel home.

All travelers entering Beijing from the hot spots of South Korea, Japan, Iran and Italy would have to be quarantined for 14 days, a top city official said. Shanghai has introduced a similar quarantine order.

The most serious outbreak outside China is in South Korea where President Moon Jae-in declared war on the virus, ordering additional hospital beds and more face masks as cases rose by 600 to nearly 5,000. Thirty-four people have died in South Korea.

In the United States, the virus is now believed to be present in at least four communities in the Pacific Northwest – two in northern California, one in Oregon and one in Washington state – and authorities there are having to go well beyond the quarantine of infected travelers and tracing of close contacts, which until now had been the response.

Six people have died in the Seattle outbreak. The U.S. Centers for Disease Control and Prevention lists more than 90 cases across the United States, a large bulk of them patients who were repatriated from the Diamond Princess cruise liner that had been quarantined in Japan.

Iran, another badly hit country, reported infections rising to 1,501, with 66 deaths, including a senior official.

The death toll in Italy jumped to 52 on Monday from 34 the day before and the total number of confirmed cases in Europe’s worst-affected country climbed past the 2,000 mark.

Germany reported 31 new infections, taking its tally to 188.


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Is It A Currency? A Commodity? Bitcoin Has An Identity Crisis

So bitcoin’s a currency, right? Well, yes, it can be used to buy, sell and price goods much like dollars and euros.

A commodity? Come to think of it, it does behave a lot like oil and gold – it can be bought and sold in cash markets or via derivatives such as futures.

What about a security? Many cryptocurrencies are, in a way. They’re issued like stocks in “initial coin offerings” and used to represent shares in online projects.

The debate may appear abstract, with little bearing on the hard-boiled world of finance, but it is attracting increasing interest from economists and lawyers who say it could have major implications for the future of cryptocurrencies.

How bitcoin and other digital coins are defined could shape how they are regulated around the world. In turn, the rules they are subject to could determine whether they make the leap from a niche to a mainstream asset.

So how will regulators treat them?

In the United States, federal watchdogs say they see elements of both securities and commodities, but like most major economies have not come up with a set of rules. The European Union, however, will outline a framework this year, which could see crypto wedged into existing regulations, or a whole new set of rules created.

For market players, how bitcoin and its kin are regulated will have serious ramifications.

Commodity markets operate with relatively little regulatory oversight. Securities, on the other hand, are typically subject to more onerous rules on price transparency, trade reporting and market abuse.

“When we’re going through the security process, we spend a lot of fees and lawyers to make sure we’re in compliance,” said Benjamin Tsai, president of Wave Financial, an investment manager in Los Angeles overseeing $40 million in crypto.

“It’s a lot more of a pain in the butt.”



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CHARACTER CLUES

Some of the cryptocurrency identity crisis lies in the fact that bitcoin was originally conceived as a means of payment, but now rarely bears the hallmarks of dollars, euros or pounds.

It’s of little use as a store of value because of its volatility, and is hampered as a means of exchange by its slow network and high transfer costs.

A booming bitcoin lending market is offering clues to its character.

Bitcoin lending offers lines of credit to crypto firms earning money in cryptocurrencies, such as payment processors or miners, looking to secure traditional money for covering expenses. Also, traders who don’t want to sell their bitcoin holdings use them as collateral to borrow cash for use in algorithmic or high-frequency trading.

For those lending money, relatively high yields are an attractive proposition in an era of rock-bottom rates.

Key characteristics of this market, such as market-led price discovery and the motivation to seek liquidity, mirror that of commodities leasing, according to market players and economists.

“The commodities markets (analogy) is very fitting,” said Deeksha Gupta, an assistant professor of finance at the Carnegie Mellon University in Pittsburgh who has researched crypto.

“One of the biggest similarities is that they are also driven by people wanting to be able to get liquidity.”

The bitcoin lending market has grown quietly as an opaque corner of the cryptocurrency sector, which itself is notorious for its lack of transparency. While there’s little data with which to gauge the size of the lending market, it is widely seen to have expanded rapidly over the past year.

New York-based Genesis Capital, one of the biggest lenders in the market, said its outstanding loans soared late last year to around $545 million compared with $100 million a year earlier.

Implied interest rates in these markets – the price of borrowing bitcoin – stand at around 4-5%, Genesis CEO Michael Moro said. On platforms for people to lend cash against bitcoin, rates are as high as 8%.

FINANCIAL INSTRUMENTS

Cryptocurrencies’ kinship to securities arises largely from their issuance and function in initial coin offerings, or ICOs, where they are used to raise traditional money.

ICOs are often held by companies seeking to raise funds for blockchain-related or other online projects. They raise capital by issuing digital coins, which grant holders access to the new system or software or a share in profits generated.

For instance, Switzerland-based Aragon – a management platform for decentralised organizations – raised about $25 million in 2017 issuing tokens that gave voting rights on how the system is developed.


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Regulators may choose to treat different cryptocurrencies differently, depending on their specific characteristics, an approach taken by Britain last year.

Some players say any designation of cryptocurrencies as financial instruments akin to securities may be positive, with burdensome oversight balanced by the potential to allow funds to market cryptocurrencies to a wider pool of investors.

“If they were somehow classified as a financial instrument, then that would have the knock-on effect that they would be eligible for retail funds,” said Nic Niedermowwe, CEO of crypto fund Prime Factor Capital in London.



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Wall Street Tries To Recover From Massive Sell-Off

Stocks rose sharply on Monday in volatile trading as Wall Street attempted to pare losses incurred during the worst week since the financial crisis amid fears of the coronavirus outbreak.

The Dow Jones Industrial Average traded 576 points higher, or 2.3%. The S&P 500 and the Nasdaq Composite climbed 2% each.

“The market has been conditioned to buy on any weakness,” said Keith Buchanan, portfolio manager at GLOBALT. “I think we’ll look back at these past few years at some point as some level of complacency.”

“Buying the dip takes more bravery now,” Buchanan said.

Stocks briefly came off their highs after a key measure on the U.S. manufacturing showed a slowdown last month. The ISM manufacturing index fell to 50.1 in February, the lowest level since the end of 2019. It also came below an estimate of 50.8.

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Apple shares led the Dow higher with a 7% jump; Merck and Walmart gained 4.6% and 6.5%, respectively. Consumer staples, utilities and real estate were the best-performing S&P 500 sectors, advancing more than 3% each. Tech, meanwhile, jumped 2.9%.

Monday’s moves mirrored the volatile overnight session where Dow futures traded in a range of more than 1,000 points, indicating this week may be as volatile as last week as well.

The Dow, S&P 500, and Nasdaq Composite all fell more than 10% last week, their biggest weekly declines since October 2008. They also entered correction territory, down more than 10% from all-time highs notched earlier in February. Both the Dow and S&P 500 have fallen for seven straight days.

Those declines came after a sharp increase in coronavirus cases outside of China. The number of cases continued to increase over the weekend, including in the U.S.

“The outbreak of Covid-19 has certainly changed the near-term narrative,” said Chetan Ahya, global head of economics at Morgan Stanley, in a note to clients Sunday. “It is an untimely shock, considering that the starting point of global growth was weak, and the recovery was very nascent.”

As of Sunday, more than 89,000 cases have been confirmed around the world along with more than 3,000 virus-related deaths. Australia, Thailand and the U.S. reported over the weekend their first coronavirus-related deaths. Rhode Island was the first U.S. state on the East Coast to report a coronavirus case. The number of cases in England rose to 35 after 12 new cases were confirmed on Sunday. Cases in China also reported more than 500 new cases on Saturday. New York Gov. Andrew Cuomo confirmed Sunday night the state’s first positive coronavirus case.



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Horrible China economic data
Wall Street got its first look over the weekend at the economic toll the virus has taken on China, the epicenter of the outbreak.

A private survey on Chinese manufacturing activity released during Asian trading hours on Monday came in at its weakest level ever. The Caixin/Markit Manufacturing Purchasing Managers’ Index (PMI) came in at 40.3 for February, far below expectations of a reading of 45.7 by economists in a Reuters poll. PMI readings above 50 indicate expansion, while those below that level signify a contraction.

That came after an official data released Saturday showed China’s official manufacturing PMI plunging to 35.7 in February, a record low, from 50 in January. A reading below 50 indicates contraction in a sector.

The plunge “shows the extent to which an outbreak can hit an economy,” said Ed Hyman, a widely followed economist on Wall Street and Evercore ISI chairman, in a note to clients. “All this is quite uncertain, and we may be overreacting. But we also don’t want to underreact.”

Gaming revenues in Macau also plunged nearly 88% last month.

Worries over the coronavirus’ impact on corporate profits and the global economy led investors to seek safer alternatives to stocks, pushing U.S. Treasury yields to all-time lows. On Sunday night, the benchmark 10-year rate broke below 1.04% for the first time ever. It was last at 1.07%.

“Global investors will be prone to panic as the virus arrives at their doorstep, underscoring the need for near-run prudence and patience before augmenting favored holdings,” strategists at MRB Partners wrote in a note. “The outlook is uncertain, or rather certainly bearish in the near term as quarantining spreads around the world, but with considerable doubt as to the duration and depth of the economic fallout.”

The virus’ quick spread has raised expectations for easier monetary policy from global central banks, including the Federal Reserve.

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CME Group’s FedWatch tool shows traders have priced in a 100% probability of a 50 basis-point rate cut later this month. Expectations for another rate cut in April are around 70%.

“The ultimate risk factor in our view is the U.S. consumer,” said Gregory Faranello, head of U.S. rates trading at AmeriVet Securities. “We have coronavirus cases showing up in the U.S. To the extent that that continues to spread, which we all hope will not be the case, the risk factor for the Fed grows because this now is no longer something that they can point the finger to relative to tariffs and say the global economy is slow, but we’re okay.”



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Global Markets – Top 5 Things to Watch This Week

The week will start after Saturday’s data showing a record contraction in China’s manufacturing and service sectors because of the coronavirus outbreak, underlining the extent of the potential impact on the broader global economy.

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Investors will also be closely watching comments from Federal Reserve policymakers this week, with the prospects of a March rate cut on the rise. Friday’s U.S. jobs report is likely to be overshadowed by the market turmoil, but the race for the Democratic U.S. presidential nomination could divert some attention from the spread of the coronavirus. OPEC is to meet later in the week and with oil prices now down 25% so far this year pressure for additional output cuts is mounting. And the Bank of Canada may surprise investors with a rate cut at its meeting on Wednesday. Here’s what you need to know to start your week.




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1 – China PMI data to shock markets
Data on Saturday showed factory activity in China contracted at its fastest ever in February, even worse than during the global financial crisis of 2008. The shockingly weak data is likely to add to fears that the world’s second largest economy may not rebound as quickly as investors had initially hoped.

Another report on Sunday showing that South Korean exports snapped a 14-month losing streak in February masked disruptions from the coronavirus, reflected outside the headline figures.

The coming days will reveal whether the outbreak is accelerating in the United States, the world’s biggest economy, how much the U.S. government is prepared to deal with an epidemic, and the economic damage in other countries.

“Right now the market is saying that this is unbounded. We don’t know what the limits are and we don’t know where it’s going to peak,” said Graham Tanaka, chief investment officer at New York-based Tanaka Capital.

2 – The Fed and U.S. data
Surveys of U.S. manufacturing activity from Markit and the Institute of Supply Management on Monday will give investors a chance to assess the economic impact of the virus. Friday’s U.S. nonfarm payrolls report for February will be watched for indications on the strength of the labor market before coronavirus spread more widely. The consensus forecast points to non-farm payrolls gaining 175,000, slowing from 225,000 in January.

Several Fed speakers are due to make appearances this week, Including Cleveland Fed President Loretta Mester, St. Louis Fed chief James Bullard, Dallas Fed head Robert Kaplan, Minneapolis Fed President Neel Kashkari and New York Fed President John Williams.

The likelihood of a March rate cut by the Fed has risen in the past week with the U.S. economy looking increasingly vulnerable to the outbreak. Fed Chairman Jerome Powell said Friday that the U.S. central bank will “act as appropriate” as the virus poses “evolving risks” to the economy.

3 – Super Tuesday
Investors will be looking ahead to Tuesday, when 14 states will cast ballots as the race for the Democratic U.S. presidential nomination intensifies.

Market watchers are waiting to see whether progressive Senator Bernie Sanders consolidates his lead or if moderates such as former Vice President Joe Biden or former New York Mayor Michael Bloomberg can make inroads.

Sanders campaign promises to break up big banks, take on drug companies and essentially abolish private insurance in favor of a single government-run plan have rattled some investors.

Shares of health insurers such as UnitedHealth Group (NYSE:UNH) and Centene Corp. (NYSE:CNC) have sold off in recent months amid growing concerns over the potential nomination of Sanders or fellow candidate Elizabeth Warren.

While investors have been more focused on coronavirus developments, some analysts have said Sanders’ rise in the polls also contributed to the recent sell-off. Some investors also noted that continued volatility in markets or an economic downturn could erode support for U.S. President Donald Trump.

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4 – Bank of Canada to make preemptive rate cut?
The Bank of Canada is to hold its latest policy setting meeting on Wednesday, the second to last such meeting before Stephen Poloz steps down as Governor.

Heightened financial market volatility amid fears over the coronavirus outbreak mean that the odds of a rate cut are rising, despite a strong domestic jobs market and inflation that is running roughly in line with the bank’s target.

Growing concern about the economic impact of protests opposing the Coastal GasLink pipeline that have severely affected the country’s rail network have also fed into expectations for a rate cut.

“The BoC has a reputation for moving early and occasionally providing surprises and we certainly think they could choose to pre-emptively cut this coming week. After all, they have much more room to offer support than most other developed markets, given their policy rate,” analysts at ING wrote.

5 – OPEC facing challenge of slumping demand outlook
The Organization of the Petroleum Exporting Countries and its allies including Russia – known as OPEC+ – meet in Vienna on Thursday and Friday as the spread of coronavirus around the world stokes fears that a slowing global economy will hit energy demand.

Friday saw the lowest closes for both Brent and WTI since December 2018. For the week, Brent lost almost 14%, its biggest weekly percentage decline since January 2016, while WTI fell over 16% in its biggest weekly percentage drop since December 2008.

“OPEC+ will have to deliver a deeper production cut as oil prices remain in freefall,” Edward Moya, senior market analyst at OANDA in New York, said in a report.

The group has already slashed oil output by 1.7 million bpd under a deal that runs to the end of March. In an initial response to counter the hit of the virus, an OPEC+ committee has recommended deepening output cuts by 600,000 bpd, but that figure is now seen as not enough by some in the group.




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Day Trading – Stock Market: 3 Things Under the Radar This Week

It was no ordinary week on Wall Street. The broader market recorded its fastest correction in history and its biggest loss since the Financial Crisis as the spread of the coronavirus gathered pace.

But there are questions on how much the Federal Open Market Committee really can help equities.

Retail sales may be the helping hand to the U.S. economy and there’s evidence some market players just don’t know which ticker is the right one.

Here are three things that flew under the radar this week.



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1. Little Hope Fed’s Easing Medicine a Match for Coronavirus Fallout

Wall Street’s fast-paced selling strengthened calls for a Federal Reserve rescue mission. And at long last, Fed Chairman Jerome Powell appeared to answer the call — at least partly.

In what may be the strongest indication yet that rate cuts are coming soon, Powell flagged the coronavirus as “evolving risk” and pledged to support the broader economy.

Powell said the “fundamentals of the U.S. economy remain strong,” but vowed that the central bank would use its tools and “act as appropriate to support the economy,” as “the coronavirus poses evolving risks to economic activity”

But with the bulk of damage from the outbreak, particularly in China, expected to hit supply more than demand, some have cast doubt on the power of monetary policy to take on the virus-led crisis.

“The problem with doing monetary stimulus is that it will have limited impact on the effects of the virus,” said Jens Peter Sorensen, chief analyst at Danske Bank A/S, in Copenhagen. “The Covid-19 virus is keeping people from work, the supply chain is disrupted and tourists are not going to Italy. Monetary policy can do very little.”

While others agree that monetary policy will do little to speed up the opening factories and ease travel restrictions, they argue that not only inaction, but a lack of bold action from the Fed may prove economically detrimental.

“Although moderate Fed rate cuts are unlikely to be very powerful, the committee will probably be reluctant to disappoint market expectations for substantial rate cuts for fear of tightening financial conditions further,” Goldman Sachs said in a note.

The investment bank said it expected the Fed to cut interest rates by 75 basis points by June, with first cut coming as soon as March.

2. Shoppers Gonna Shop?

With Covid-19 threatening to become a pandemic and countries looking at various quarantine measures, service-heavy economies are looking at a sharp drop in economic activity.

But the U.S. National Retail Federation released a report this week that expresses confidence that the consumer will remain resilient, even in the face of Black Swan events.

Retail sales will rise 3.5% to 4.1% to between $3.93 trillion and $3.95 trillion in 2020, the NRF said. Online sales will be up between 12% and 15%.

“With gains in household income and wealth, lower interest rates and strong consumer confidence, we expect another healthy year ahead,” NRF President and CEO Matthew Shay said in a statement.

“There are always wild cards we cannot control like coronavirus and a politically charged election year,” Shay said. “But when it comes to the fundamentals, our economy is sound and consumers continue to lead the way.”

On Friday, the University of Michigan said its February consumer sentiment index came in at 101, up from 99.8 in January.

3. Pushing the Panic Button

Is Covid-19 dealing with not just “panic selling,” but also “panic buying”?

The money pouring into any stock with Zoom in the name says so.

With companies facing possibly protracted times with employees staying at home, video conferencing will be essential to keeping businesses running. With that in mind, investors have been buying shares of Zoom Video Communications (NASDAQ:ZM).

The company “is widely considered the leader in modern enterprise video communications, with an easy, reliable cloud platform for video and audio conferencing, online meetings, chat and webinars,” Investing.com’s Jesse Cohen wrote.

The stock is up about 40% year to date.

But less-than-fastidious buyers have also been snapping up shares of Zoom Technologies (OTC:ZOOM), an over-the-counter stock that isn’t really in business anymore and hasn’t reported earnings since 2011.

Because it has the catchier ticker of “ZOOM,” it’s up 140% in the last five trading days.

While Zoom Technologies has seen ancillary benefits, Constellation Brands (NYSE:STZ) is dealing with reports of consumers being afraid of its Corona beer due to the similarity of the beer’s name and the coronavirus.

But Constellation said reports sales are plunging are “unfounded” and that sales of Corona are climbing in the U.S.




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Financial Markets – Panic Selling Continues as Dow Tumbles Below 25,000

Panic selling continued in the U.S. stock market on Friday, putting the market on course for its biggest weekly loss since 2008 amid growing signs that the coronavirus outbreak will ultimately cause an economic shock in Western economies as well as in China and its Asian trading partners.

The Dow Jones Industrial Average opened with another loss of 627 points, or 2.6%, taking it below the 25,000 mark. By 10:33 AM ET (1533 GMT), the DJIA was down 4%, or 1,034 points.

The S&P 500 was down 3.4%, at its lowest since October 2019. The Nasdaq Composite, meanwhile, fell 2.7%.


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Overnight, another sharp jump in the number of confirmed Covid-19 cases in South Korea and Iran, coupled with new emergency virus containment measures in Germany, Switzerland and elsewhere, all contributed to keeping the mood negative. A better-than-expected monthly rise of 0.6% in U.S. personal income in January was of little consolation.

“The landscape remains very uncertain,” said Mark Dowding, chief investment officer of BlueBay Asset Management in a weekly note. “For now, there is a sense with the coronavirus that things will need to get worse before they can get better.”

He argued that the point of “maximum bearishness” could be another couple of weeks away.

“This could coincide with the moment that Covid19 is officially declared a pandemic by the World Health Organization,” something that could lay the groundwork for a coordinated response of policy stimulus, Dowding argued. Such hopes seem far away at the moment, with the U.S. and German governments both playing down the seriousness of the situation.



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The bond market is now betting heavily on the Federal Reserve riding to the rescue. The2-Year Treasury bond yield dipped below 1% overnight and then roared lower to 0.91% after St. Louis Fed President James Bullard indicated that the Fed, if not fiscal policy, would react to a global pandemic.

“Further policy rate cuts are a possibility if a global pandemic actually develops with health effects approaching the scale of ordinary influenza, but this is not the baseline case at this time,” Bullard, who doesn’t vote on monetary policy this year, said Friday in prepared remarks to be delivered in Fort Smith, Arkansas.

Hot money continued to flood out of Tesla (NASDAQ:TSLA), which lost another 7.1%, taking its losses for the week to over 30%.

Beyond Meat (NASDAQ:BYND) suffered similar problems following a surprise quarterly loss after the bell Thursday, losing 17.6%. It’s now down 25% for the week.

Apple (NASDAQ:AAPL) was also the subject of some heavy profit-taking, falling 5.1% to its lowest since December. None of the companies mentioned released any news of note.

One stock emphatically bucking the trend was Zoom Video Communications (NASDAQ:ZM), the maker of software for video conference calls. Zoom Video stock has been flying as participants price in a boom in such calls as Covid-19 spawns a global outbreak of working from home and restrictions on business travel.

JPMorgan (NYSE:JPM), L’Oreal (PA:OREP) and Nestle (SIX:NESN) have all said this week they intend to limit staff travel as a result of the outbreak.



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Stock Market Corrections: How Bad Can They Get And How Long Can They Last?

With the stock market sliding lower as coronavirus fears rise, all the talk about a so-called “correction” can cause nervousness and confusion.




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A correction is a mechanical-sounding term to describe when a major stock market index like the Standard & Poor’s 500 falls 10% or more from a recent closing high. The recent losses on Wall Street officially pushed all three benchmarks into correction territory during trading Thursday.

The Dow Jones industrial average tumbled as much as 1,190 points, while the S&P 500 and the Nasdaq Composite both dropped more than 4%.

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It took just eight calendar days for the S&P 500 index to meet the 10% threshold — its fastest such drop since World War II, according to Sam Stovall, chief investment strategist at financial-research company CFRA.

“The swiftness of this decline signals the magnitude of uncertainty being expressed by investors,” Stovall said. “Even though history says that other viruses haven’t been a major event to corporate bottom lines, investors are thinking this time might be different.”

How bad were the biggest corrections?

Since a correction is a drop between 10% and 19.99%, there’s always a chance we’re only about halfway through this recent scare. The market fell more than 19 percent in corrections in 2018, 2011, 1998 and the 1976-78 period, CFRA data shows.

But even so-called “garden variety” corrections can cause fear levels to spike.

The good news? Not every correction morphs into a more feared bear market, a 20% or higher drop. The average bear since 1929 has sliced nearly 40% off the S&P 500.

Most bear markets coincide with a recession.

In the 23 corrections since World War II the average price drop for the S&P 500 has been 14 percent, according to data from CFRA. They normally last around 4.4 months.

Greg McBride, a chief financial analyst for Bankrate.com, thinks a recession is an unlikely, but “ever-present threat.”

“We’re not immune from the economic cycle. Disruptions to economic expansion can certainly be the catalyst for a recession,” McBride said. He added that the jumpy stock market is a reflection of uncertainty surrounding the spread of coronavirus.

“In the face of uncertainly, markets and valuations are being subjected to a rapid reevaluation. That’s what’s underpinning the selling action that’s been prevalent this week,” McBride said.



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China Makes Bad Loans Disappear as Virus Pummels Banks

Chinese banks are taking extraordinary measures to avoid recognizing bad loans, seeking to shield themselves and cash-strapped borrowers from the economic fallout of the coronavirus outbreak.

Some of the measures, which include rolling over loans to companies at risk of missing payment deadlines and relaxing guidelines on how to categorize overdue debt, have the explicit approval of regulators in Beijing. Some lenders are also refraining from reporting delinquencies to the country’s centralized credit-scoring system and allowing borrowers to skip interest payments for as long as six months, according to people familiar with the matter, who asked not to be named discussing internal decisions.


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The moves will buy time for both Chinese companies and the nation’s $41 trillion banking industry, after the outbreak brought much of the world’s second-largest economy to a standstill. But they’re also fueling concern about a buildup of hidden risks on lenders’ balance sheets. Some analysts worry that China is reversing a multi-year push to increase the transparency of its financial system and undermining the long-term health of banks.

“This will provide breathing space,” said Harry Hu, a credit analyst at S&P Global Ratings. “It will also likely undermine standards, making some Chinese banks less creditworthy in the long run.”

Earlier this month, S&P said a prolonged health emergency could cause China’s non-performing loan ratio to more than triple to about 6.3%, amounting to an increase of 5.6 trillion yuan ($800 billion) in bad debt.

The push by banks and regulators to tamp down NPLs is part of a broader effort by President Xi Jinping’s government to shore up the Chinese economy, which some forecasters say may suffer a rare quarter-on-quarter contraction in the first three months of this year. In addition to pumping billions of yuan into the banking system to make it easier for lenders to extend credit, authorities have cut interest rates, reduced taxes and pledged to adopt more “proactive” fiscal policies.

Shares of Chinese banks continued to under-performer the benchmark index this year in Hong Kong. The four biggest state-owned banks are trading at an average 0.5 times their estimated book value for this year, near the record low.

The NPL measures mark an abrupt shift in China’s approach toward financial regulation. Authorities in Beijing have spent the past three years trying to instill more discipline in the banking system and develop credit markets that more accurately price risk. As part of that effort, they’ve encouraged banks to be more diligent when accounting for bad loans.

The outbreak has changed the government’s priorities. In a press conference this week, Ye Yanfei, an official at the China Banking and Insurance Regulatory Commission, said policy makers need to be more tolerant when it comes to bad loans. “Saving corporates now is saving banks themselves,” Ye said.

China isn’t the only country to have relaxed accounting standards for banks during a crisis. In April 2009, during the depths of the global recession, mark-to-market rules in the U.S. were eased after banks complained that they resulted in bigger-than-warranted writedowns on thinly traded mortgage securities. While critics of the decision said it reduced transparency, it arguably helped big American lenders recover more quickly from the crisis.

China’s ability to control the pace of NPLs during economic shocks is an advantage of its centralized financial system, according to Leland Miller, the chief executive officer of China Beige Book.

“When you have a party that controls all the counterparties in the economy — you have state banks loaning to state enterprises and you have state banks loaning to small- and medium-sized enterprises — you can tell them to lend,” Miller said in an interview on Money Undercover with Bloomberg TV’s Lisa Abramowicz. “You never have to freeze up liquidity in the same way that a commercial financial system would work.”

Yet even if China’s banks turn on the credit taps, lots of businesses may struggle to secure the funding they need to stay afloat.

A survey of small- and medium-sized Chinese companies conducted this month showed that a third of respondents only had enough cash to cover fixed expenses for a month, with another third running out within two months. About two-thirds of the country’s 80 million small businesses, including many mom-and-pop shops, lacked access to loans as of 2018, according to China’s National Institution for Finance & Development.

It remains to be seen whether the benefits of delaying NPLs will outweigh the costs. Much depends on how quickly Chinese authorities can contain the outbreak and get the country back to work. In the week to Feb. 21, the economy was likely running at 50%-60% capacity, according to Bloomberg Economics.



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A sharp recovery in coming months would likely ease concerns that banks are obscuring the true health of their balance sheets. “If they can tide the virus over, then the delinquent loans will disappear,” said Zhang Shuaishuai, a banking analyst at China International Capital Corp.

But that’s far from a given. S&P analysts see scope for caution, saying last week that it may take years for the industry to revert to normal standards for recognizing NPLs and that some banks may see their long-term health suffer as a result.



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Wall Street Slips Into Correction Territory

Wall Street‘s main indexes fell for the sixth straight session and slipped into correction territory on Thursday, as the rapid spread of the coronavirus outside China intensified fears about the hit to economic growth and corporate earnings.

The S&P 500 and Nasdaq are now more than 10% below their intraday record highs hit on Feb. 19, while the Dow Jones Industrials is 10% off its Feb.12 peak.

The indexes were set for their steepest weekly pullback since the global financial crisis as rising number of new infections outside China raised fears of a pandemic.

Adding to worries, the U.S. Centers for Disease Control and Prevention confirmed an infection in California in a person who reportedly did not have relevant travel history or exposure to another known patient.

“In the recent week, markets have come to realize that the outbreak is much worse and are now realistically pricing in the impact of the virus on the economy,” said Philip Marey, senior U.S. strategist at Rabobank.

“In that sense it’s a bit of a catching up from the relative optimism that was there in the beginning when markets thought (the virus) will be contained to China with some minor outbreak outside.”

Industry analysts and economists continued to sound the alarm as they assessed the impact of the coronavirus, with Goldman Sachs (NYSE:GS) saying U.S. firms will generate no earnings growth in 2020.

Bank of America (NYSE:BAC) slashed its global growth forecast to the lowest level since the peak of the financial crisis.

At 10:08 a.m. ET, the Dow Jones Industrial Average was down 573.93 points, or 2.13%, at 26,383.66, the S&P 500 was down 67.33 points, or 2.16%, at 3,049.06. The Nasdaq Composite was down 221.07 points, or 2.46%, at 8,759.70. All of the 11 S&P sectors were deep in the red with energy losing the most, down 4.1%. Technology, financial, industrials, consumer discretionary, materials and communication services sectors dropped more than 2% each.

Declining issues outnumbered advancers for a 8.83-to-1 ratio on the NYSE and for a 8.65-to-1 ratio on the Nasdaq.

The S&P index recorded four new 52-week highs and 90 new lows, while the Nasdaq recorded 15 new highs and 361 new lows.



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Ways To Save $5,000 This Year { 2020 }


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Wouldn’t it be nice if money grew on trees? Although you’ll never find dollar bills sprouting from your favorite oak tree, you can uncover money in other places. By spending some time dissecting your spending habits and scrutinizing your expenses, you could free up money in your budget and save big – up to $5,000 in a year.

If you haven’t had success in cutting costs and saving money in the past, chances are you haven’t been looking in the right places. Follow these expert-backed tips to save on everything from monthly bills to annual subscriptions, and get on your way to saving thousands of dollars this year.


> Adjust your temperature setting.
> Unplug unused gadgets.
> Increase your insurance deductible.
> Nix that unused gym membership.
> Trim your subscription services.
> Cut back on takeout.
> Reduce food waste.
> Cut commuting costs by carpooling.
> Switch to a free banking account.
> Organize a parent babysitting co-op.
> Go to the movies midweek.


Adjust Your Temperature Setting
The average energy bill in the U.S. costs $117.65 per month, with heating and cooling accounting for 43% of this cost, according to the Energy Information Administration. Meanwhile, the Department of Energy says you can save as much as 10% a year on your energy bill by turning your thermostat back by 7 to 10 degrees for eight hours a day from its normal setting.

Potential savings: $141 per year.


Unplug Unused Gadgets
Turning off an electronic doesn’t mean it’s completely shut down. Commonly referred to as “energy vampires,” many devices continue drawing energy even in the off mode when they remain plugged in, says Cisco DeVries, energy expert and CEO at OhmConnect, a clean energy program.

Think: set-top cable boxes, gaming consoles, coffee makers and space heaters. Although each may use a very small amount of energy, collectively and over time, it adds up. According to to the Lawrence Berkeley National Laboratory, a typical American home has 40 products constantly drawing power which amount to almost 10% of residential electricity use.

To stop these energy vampires from wasting power, DeVries suggests using smart plugs or smart power strips. These devices automatically shut off power supply to any gadgets that aren’t in use, he says. By doing this, you can shave approximately 5% off your electricity bill or more.
Potential savings: $71 per year.


Increase Your Insurance Deductible
One quick hack to lowering your annual homeowners insurance or auto insurance premium is to increase the deductible. According to a 2019 study by the National Association of Insurance Commissioners, the national average homeowners insurance premium hovers just above $1,211. This same study found that if you bump your deductible from $500 to $1,000, you’re looking at reducing your bill by as much as 25%. With a higher deductible there’s less risk to the insurer, so they can offer a lower premium.

“Ask your agent how much money you will save if you adjust your deductible and put that savings into an online savings account until the balance reaches the deductible amount,” advises Jim Wang, founder of personal finance blog Wallet Hacks and former U.S. News contributor. This way, you’re covered in the event of a repair, he says.

When it comes to your auto insurance, data pulled by CarInsurance.com estimates that consumers can save nearly $14 per month by increasing their deductible from $250 to $500, or pocket an extra $30 every month by bumping their $250 deductible to$1,000.
Potential savings: $303 a year.


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Nix That Unused Gym Membership
If you committed to a gym membership at the beginning of the year as part of your New Year’s resolutions, but you already see your visits dwindling, don’t get stuck paying for something you aren’t using, says Nadia Malik, blogger and owner of personal finance site SpeakingOfCents.com, who recommends canceling your unused membership.

Considering the average monthly cost of a gym membership is $58, and 67% of gym members fail to use their membership, as reported by research site StatisticBrain.com, this is a huge drain on your budget. Although canceling that membership may feel like you’re giving up hope on getting back into shape, there are plenty of free ways you can get fit, Malik advises. You can walk, run or bike ride outside when the weather is nice or opt to follow free workout videos online or use a free fitness app such as Fitbod for strength training and C25K for running, she adds.

Potential savings: $696 per year.


Trim Your Subscription Services
According to the America’s Relationship with Subscription Services research by West Monroe, a national technology consulting firm, U.S. consumers spend an average of $237.33 on subscription services every month. From video streaming to on-demand music to data storage to photo editing apps, such subscription services may seem minimal at first glance but they add up quickly. Spend time reviewing all the services you’re subscribed to and identify where you can cut back.

For instance, if you love listening to audio books while commuting, the audio subscription service Audible is popular. However, Kristal Audain, blogger and founder of personal finance blog NormalisBroke.com, points out that there are free alternatives, making this an unnecessary service to pay for.

“Most libraries now offer Libby by Overdrive, which allows you to check e-books and audiobooks from your computer or smartphone,” Audain says.

At nearly $15 per month, canceling an Audible subscription and using your local library can result in big savings.

Potential savings: $179 per year.


Cut Back on Takeout
The average U.S. household spends $3,459 per year on food away from home, according to the 2018 Consumer Expenditures report from the Bureau of Labor Statistics. By cooking at home and preparing lunches for your family to bring to work or school just 25% of the time, you could save around $288.25. Since many people lean toward takeout when time is limited, cook meals in bulk so you always have leftovers that are easy and quick to reheat.

Meanwhile, Catherine Alford, family finance expert at http://www.CatherineAlford.com, a site dedicated to helping working women make better financial choices for their families, says researching deals at restaurants in your area can reduce the cost of dinner out.

“My local seafood place lets kids eat free on Tuesdays, and our local Mexican restaurant lets kids eat free on Sundays. By knowing the deals available to you throughout the week and the different perks your restaurants offer, you can save as much as 25% per year on restaurant costs,” she says.
Potential savings: $288 per year.


Reduce Food Waste
Food waste isn’t just bad for our environment – it’s bad for our wallets and costs the average American household roughly $1,866 per year, according to a new study from Pennsylvania State University. Cutting down on food waste won’t happen overnight, but a few simple tricks can help you start saving.

Lamar Brabham, CEO and founder of Noel Taylor Agency, a financial services firm in North Myrtle Beach, South Carolina, suggests keeping a running food inventory list in your kitchen that you can quickly reference before heading to the store so you don’t double up on ingredients that could go to waste.

Meanwhile, planning a few weekly meals in advance that use similar ingredients can also keep food waste to a minimum.

Potential savings: $1,866 per year.


Cut Commuting Costs by Carpooling
Consumers often overlook the financial impact of commuting by car to work five days a week, but the expense can be startling when you tally it up. According to the 2015 Citi ThankYou Premier Commuter Index, the average cost of an American commute is $10 per day, which can add up to $2,600 over a year of weekday traveling.

Saving money is possible by carpooling with just one person, which essentially splits your costs in half, says Steve Pilloff, assistant professor of finance at George Mason University’s School of Business.

Finding someone to carpool with may seem tricky, but start by asking co-workers or look for neighbors who travel to a similar area for work. Otherwise, plan a carpool through the popular traffic map app, Waze, which helps connect workers looking to share rides.
Potential savings: $1,300 per year.


Switch to a Free Banking Account
When you’re trying to save money, bank fees can eat away at your efforts. In fact, average checking account charges hover over $9.30, according to ValuePenguin. However, Simon Zhen, a research analyst for financial services comparison site MyBankTracker.com, says there are plenty of free options.

“By switching to a free checking account, such as those often offered by online banks, a consumer can avoid paying any monthly fee,” he says.
Potential savings: $112 per year.


Organize a Parent Babysitting Co-op
Ask any parent and they’ll tell you that babysitting costs add up. Beyond day care while you’re at work, you may need a sitter for a weeknight or weekend. With the average babysitting rate at $16.25 per hour, according to the 2019 Care.com Cost of Care Survey, going out sans kids for four hours once per month will set you back an extra $780 a year in child care.

However, Violette de Ayala, founder and CEO of FemCity, a networking group for professional women, says you can easily save by setting up a babysitting co-op with other parents in your neighborhood or through your children’s school. “It creates an instant play date for the little tikes and saves parents the hourly rate for a sitter,” she says.

Potential savings: $780 per year.


Go to the Movies Midweek
The average movie ticket costs was $9.16 in 2019, according to the National Association of Theatre Owners. For a family of four, catching a new flick on the big screen will cost over $36.64 just on movie tickets, and much more if you add popcorn, candy and soda. If you go to the movies once a month, plan your movie night during the week to save.

Many theaters offer discounts on movie tickets during the week to loyalty members. For example, Regal Cinemas offers Regal Crown Club Value Days at select theater locations where Regal Crown Club members can enjoy movie ticket prices at around 50% off, plus discounts on concessions.

Meanwhile, keeping the kids entertained during the summer doesn’t have to be expensive either, thanks to programs such as Cinemark’s Summer Movie Clubhouse, offering $1 kid-friendly flicks, from May 27 to Sept. 8, 2020.

Potential savings: $220 a year.




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Pandemic Fears Pummel Stocks

Stocks sunk deeper into the red on Thursday, oil prices fell and U.S. Treasuries rallied into record territory as more signs of the global spread of the coronavirus heightened fears of a pandemic.

Global markets have dropped for six straight days, wiping out more than $3.6 trillion in value. Much remains unknown about the virus that originated in China, but it is clear the ramifications of the world’s second biggest economy in lockdown for a month or more are vast.

Analysts have sharply downgraded their China and global growth forecasts, while policymakers from Asia, Europe and the United States have begun to prepare for a potentially steep economic downturn than initially anticipated.

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E-mini futures for the S&P 500 were down 1.4% (ESc1) and Europe appears set for a catch-up slump. EuroSTOXX 50 futures fell 2.7% (STXEc1) and FTSE futures skidded 2.3% (FFIc1).

Oil, sensitive to global growth given the vast energy consumption in a many countries, fell more than 1% to its cheapest in over a year. [O/R]

MSCI’s broadest index of Asia-Pacific shares outside Japan (MIAPJ0000PUS) fell 0.5% and is down more than 4% for the week.

The yield on U.S. Treasuries, which falls when prices rise, dropped in to uncharted waters underneath 1.3% (US10YT=RR). Bets on monetary easing in the United States have surged. [US/]

“I think the market is just pushing the Fed to cut rates,” said Stuart Oakley, Nomura’s global head of flow FX in Singapore.

“It’s a flight to quality as well,” he said.

“The news seems to be creating this mass hysteria everywhere, there’s panic that the world’s about to end, so people are getting out of risk and putting their money in safe havens and the biggest one of those are 10-year Treasury bond.”

China accounts for about 96% of cases but most new infections are now being reported elsewhere.

News on Thursday of a jump in cases in South Korea was accompanied by a warning that the virus may be spreading in California.

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Taiwan raised its epidemic response level to the highest possible. Japan’s Nikkei dropped 2% to a four-month low amid more worries that the Tokyo Olympic Games could be cancelled or shifted. (T)

And on top of that a tour-bus guide in Japan also tested positive to the virus for a second time, raising questions about how the pathogen spreads.

“This feels like a consolidation, potentially before another leg down,” said Jeffrey Halley, Senior Market Analyst at brokerage OANDA by phone from Jakarta.

The only bright spot, ironically, was China’s stock market, which climbed in relief that domestically, at least, the containment efforts are showing signs of working. (SS)

NO EQUIVALENT SHOCK

At the same time as the breadth of the virus’ spread has knocked markets, analysts have been steadily revising their estimates of the economic damage higher.

J.P. Morgan now expects Chinese GDP to shrink 3.9% this quarter, while Capital Economics sees it contracting this year.

“There is no equivalent exogenous shock the world has gone through in the post-Bretton Woods period,” said Deutsche Bank (DE:DBKGn) analyst Alan Ruskin in a note.

“Work place disruption, trade interlinkages, business uncertainties, profit warnings, inability to pay, and capacity to service credit are all related supply-side issues that, in turn, generate demand effects on employment, disposable income, wealth and confidence.”

Only a dramatic ratcheting higher of bets on interest rate cuts in the United States has given pause to the huge flow of money from Asia into greenbacks in the currency markets.

From almost nothing a week ago, markets are pricing a roughly even chance of a Federal Reserve interest rate cut next month and have almost fully priced a cut by April. <0#FF:>

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That was enough to help drag the China-sensitive Aussie dollar from an 11-year low and lend support to the euro (EUR=). [FRX/]

The Aussie last traded at $0.6550 and the euro lifted through $1.09 for the first time in two weeks to buy $1.0908.

The safe-haven Japanese yen firmed to 110.02 per dollar.





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Moderna Inc. Ships First Experimental Coronavirus Vaccine For Human Tests

Drugmaker Moderna Inc. has shipped the first batch of its rapidly developed coronavirus vaccine to U.S. government researchers, who will launch the first human tests of whether the experimental shot could help suppress the epidemic originating in China.

Moderna on Monday sent vaccine vials from its Norwood, Mass., manufacturing plant to the National Institute of Allergy and Infectious Diseases in Bethesda, Md., the company said. The institute expects by the end of April to start a clinical trial of about 20 to 25 healthy volunteers, testing whether two doses of the shot are safe and induce an immune response likely to protect against infection, NIAID Director Anthony Fauci said in an interview. Initial results could become available in July or August.

Moderna’s turnaround time in producing the first batch of the vaccine—co-designed with NIAID, after learning the new virus’s genetic sequence in January—is a stunningly fast response to an emerging outbreak.

If a trial starts as planned in April, it would be about three months from vaccine design to human testing. In comparison, after an outbreak of an older coronavirus, severe acute respiratory syndrome, in China in 2002, it took about 20 months for NIAID to get a vaccine into the first stage of human testing, according to Dr. Fauci.

“Going into a Phase One trial within three months of getting the sequence is unquestionably the world indoor record. Nothing has ever gone that fast,” Dr. Fauci said.

Public-health authorities say advances in vaccine technology, aided by government and private investments, are shortening development timelines when outbreaks occur. In the past, researchers scrambled to develop vaccines in response to outbreaks such as SARS, Ebola and Zika with mixed results. Older types of vaccines are developed from viral proteins that must be grown in eggs or cell cultures, and together with animal testing it can take years before a vaccine can be used in humans.

Newer approaches rely on what are known as platform technologies—building blocks that can be tweaked quickly with the genetic information from a newly emerged pathogen.

The fast production of a vaccine and plans to test it soon don’t guarantee its success. “You’re never sure until you’re at the end what you have,” said Bruce Gellin, president of global immunization at the Sabin Vaccine Institute. Saying there are other coronavirus vaccines in the works, he added: “The sequence of testing is designed to sort out what works from what doesn’t. That’s why it’s important to try as many things as possible that seem feasible, because not all horses will finish the race.”

It is uncertain whether Moderna’s vaccine will work because its gene-based technology hasn’t yet yielded an approved human vaccine. And even if the first study is positive, the coronavirus vaccine might not become widely available until next year because further studies and regulatory clearances will be needed, Dr. Fauci said.

But health authorities say it is worth placing bets on these new technologies in the face of fast-moving outbreaks. Since early January, when only a few dozen cases were confirmed in central China, the virus has spread to more than 79,000 people, including more than 2,600 who have died. The vast majority of the cases are in China, according to the World Health Organization.

Dr. Fauci said it is possible the spread of coronavirus could lessen during warmer months, but then return next winter and become a seasonal virus like the flu, making a vaccine useful even if it isn’t ready for widespread distribution until next year.

“The only way you can completely suppress an emerging infectious disease is with a vaccine,” Dr. Fauci said in his office in Bethesda. “If you want to really get it quickly, you’re using technologies that are not as time-honored as the standard, what I call antiquated, way of doing it.”

Moderna, which has more than 800 employees, was founded in 2010 to develop drugs and vaccines based on what is known as messenger RNA, the genetic molecules that carry instructions from DNA to the body’s cells to make certain proteins. The company is targeting cancer, heart disease and infectious diseases. It hasn’t brought any drugs or vaccines to market.

Moderna Chief Executive Stephane Bancel said he got in touch with NIAID after hearing about the new China virus while vacationing with his family in France in early January, to discuss collaborating on a vaccine.

Chinese scientists found the genetic sequence of the new virus and published it online around Jan. 10. Researchers at NIAID and Moderna analyzed the sequence and homed in on a section they believed was most likely to induce the desired immune response if incorporated into a vaccine. NIAID agreed to run a clinical trial if Moderna could supply a vaccine.

Moderna didn’t need actual samples of the virus or its proteins. The company’s vaccines instead contain nucleic acids with genetic codes that instruct the body’s own cells to make certain proteins from the virus that don’t infect a person, but trigger an immune response.

Moderna in 2018 opened a manufacturing site in the shell of a former Polaroid plant in Norwood, near the company’s Cambridge, Mass., headquarters. In the plant, employees wearing white lab gowns, hair nets and safety goggles work amid lab hoods, robotic machinery and steel tanks to produce drugs and vaccines for clinical trials. Meeting rooms are named after famous scientists such as Curie and Pasteur.

To make the coronavirus vaccine, Moderna repurposed some of the robotic equipment that was making cancer vaccines tailored to the genetic mutations of patients’ tumors.

As many as 100 manufacturing and quality-control employees were involved in the effort, many working nights and weekends. As manufacturing ramped up, the company’s leaders had frequent meetings, calls and WhatsApp messaging chains to monitor progress, and stayed in close contact with NIAID.

After Moderna’s effort became public in January, friends and family members became interested.

Juan Andres, Moderna’s head of technical operations, said, “I wasn’t used to my kid thinking I did anything cool,” but his 15-year-old son began asking questions about the project at dinner.

Moderna finished manufacturing about 500 vials on Feb. 7, a Friday. Normally, the company would have waited until Monday to start quality-control tests, but about 10 to 15 workers spent the weekend testing samples for potency and other features. The batch cleared most tests that weekend, but it took about two weeks to complete sterility testing. Moderna stored the supply in freezers set to minus-70 degrees Celsius.



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One risk of moving so fast is that Moderna and NIAID won’t know for sure they picked the best fragment of the virus’s genetic sequence to target until the human study is completed.

“It is possible it’s going to work, but we have to wait and see,” said Mr. Bancel, Moderna’s CEO.

The first trial will be conducted at NIAID’s clinical-trials unit in Bethesda. If the first one is successful, a second trial of hundreds or thousands of participants could begin, which could take six to eight months, Dr. Fauci said. This trial could be conducted partly in the U.S. but also in China or a region where the virus is spreading, so the testing could gauge whether the vaccine reduces infection rates.

If the second trial is positive, the vaccine could be ready for widespread use, he said. How widely the virus has spread by then will determine whether it is given to targeted groups such as health-care workers, or more broadly to the general population, Dr. Fauci said.





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Pandemic Fears Grip Wall Street

Wall Street plunged into the red in early trading Monday as a spike in the number of Covid-19 virus cases confirmed outside of China pushed money out of riskier investments.

The Dow dove 905.27 points, or 3.12%, to 28,087.04 at 9:35 AM ET (14:35 GMT) and the S&P 500 fell 93.63, or 2.8%, to 3,245.62. The Nasdaq Composite plunged 341.72, or 3.6%, 9,234.87, with tech stocks particularly hard hit.

The U.S. Treasury yield curve inverted the most since October and the 10-Year yield fell below 1.37%. Its all-time low is 1.32% hit in 2016 after the Brexit vote.

Worries snowballed over the weekend as the numbers of cases of Covid-19 jumped in Italy, South Korea and Iran. Authorities in Italy imposed a quarantine in the north of the country and its benchmark MIB index tumbled nearly 6%.

The Covid-19 shock is a test of the fear-of-missing-out (FOMO) and buy-the-dip conditioning that has helped stocks overcome the headwinds of valuations, Allianz (DE:ALVG) Chief Economic Adviser Mohamed El-Erian tweeted.

“A key element is whether markets distinguish between Central Banks’ willingness (high) and ability (low) to counter the economic shock,” he said.

Among individual stocks, Dow component Apple (NASDAQ:AAPL) sank 6% after the latest data showed shipments of mobile phones in China dove 36.6% in January from the year-ago period.



High-flying Tesla (NASDAQ:TSLA), which has a factory in Shanghai, was also hit on virus worries, with shares dropping 8.6%.

Chip stocks were also hard hit. Advanced Micro Devices (NASDAQ:AMD) lost 10.2%, Nvidia (NASDAQ:NVDA) tumbled 8.4% and Micron Technology (NASDAQ:MU) slumped 7.4%.

Expectations that the Federal Reserve would stop in with a rate cut to help the economic situation rose today, with the odds of a March cut rising to more than one in four.

“Growing consensus among economist(s) I am speaking to at (the National Association for Business Economics 2020 conference) is that the Fed will have to cut and do so soon – March – in response to COVID-19,” Grant Thornton Chief Economist Diane Swonk tweeted. “It may not be called a health pandemic yet but it is an economic pandemic.”




Diane Swonk@DianeSwonk

Growing consensus among economist I am speaking to at is that the Fed will have to cut and do so soon – March – in response to COVID-19. It may not be called a health pandemic yet but it is an ecomomc pandemic.









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The Coronavirus Outbreak Is Bringing Attention To The Fast-Growing Vaccine Industry

The vaccine market has grown sixfold over the past two decades, worth more than $35 billion today, according to AB Bernstein. The firm said the industry has consolidated to four big players that account for about 85% of the market — British drugmaker GlaxoSmithKline, French pharmaceutical company Sanofi, and U.S.-based Merck and Pfizer.

“For every dollar invested in vaccination in the world’s 94 lowest-income countries, the net return is $44. Hard to argue against,” Wimal Kapadia, Bernstein’s analyst, said in a note. “This oligopoly has been built through significant market consolidation driven primarily by the complexities of the manufacturing and supply chain.”

These companies have jumped into the race to combat the deadly coronavirus, working on vaccine or drug programs. Investors have been flocking to some biotech names amid market volatility in hopes that their initiatives to develop treatment and prevention for the coronavirus could come to fruition at some point.



Sanofi is teaming up with the U.S. government to develop a vaccine for the new virus, hoping its work on the 2003 SARS outbreak could speed up the process. GlaxoSmithKline said this month it is partnering with the Coalition for Epidemic Preparedness Innovations for a vaccine program.




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Still, any commercial treatment for the coronavirus could be years away. Experts have warned despite recent advances, the public shouldn’t expect a coronavirus vaccine to hit the market until early next year.

The Bernstein analyst said Sanofi and GlaxoSmithKline both have a stable vaccine portfolio, including shingles, flu, pertussis and polio vaccines, that will keep driving revenue.

‘Long-lived assets’
Merck’s vaccine business generated $8.4 billion of revenues in 2019, the segment has been growing at an annual rate of 9% since 2010, according to Bernstein.

Its human papillomavirus vaccine Gardasil 9 will be “the biggest selling vaccine of all time,” Kapadia said. “Gardasil 9 will take over the HPV market given competition is limited – supply is the only decelerator.”

For Pfizer, while its vaccine business has stagnated in recent years, its pipeline has “blockbuster potential,” the analyst noted.

“Vaccines are long-lived assets, have high barriers to entry, typically stable/growing pricing, mostly limited competition and no patent cliff,” Kapadia said.

To be sure, while vaccine companies can see periods of high growth, real innovation is needed to be long-standing winners in a market that requires major capital and faces cheaper alternatives from emerging markets, the analyst cautioned.




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Financial Markets News: Stocks under pressure as Apple sounds warning on coronavirus

The warning from the most valuable U.S. company sobered investor optimism that stimulus from China and other countries would protect the global economy from the effects of the epidemic.

Asian shares fell and Wall Street was poised to retreat from record highs on Tuesday after Apple Inc (O:AAPL) said it would miss its March quarter revenue guidance as the coronavirus slowed production and weakened demand in China.


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S&P500 e-mini futures (ESc1) slipped as much as 0.4% in Asian trade while Nasdaq futures fell 0.6%.

European stocks were expected to follow suit, with major European stock futures (STXEc1) (FDXc1) (FFIc1) trading 0.5-0.6% lower.

MSCI’s broadest index of Asia-Pacific shares outside Japan (MIAPJ0000PUS) fell 1.0%, while Tokyo’s Nikkei (N225) slid 1.4%, dragged down by tech stocks.

China’s CSI300 (CSI300) blue chip shares gave up 0.5%, following a strong rally that was fueled by hopes Beijing would introduce more policy stimulus.

China’s central bank cut the interest rate on its medium-term lending on Monday, paving the way for a likely reduction in the benchmark loan prime rate on Thursday.

However, sentiment took a subsequent knock as Apple said factories in China were re-opening but ramping up more slowly than expected, reinforcing signs of a broader hit to businesses from the epidemic.

“Apple is saying its recovery could be delayed, which could mean the impact of the virus may go beyond the current quarter,” said Norihiro Fujito, chief investment strategist at Mitsubishi UFJ Morgan Stanley (NYSE:MS) Securities.

“If Apple shares were traded cheaply, that might not matter much. But when they are trading at a record high, investors will be surely tempted to sell.”

Asian tech shares were also hit. Samsung Electronics (KS:005930) dropped 2.9%, Taiwan Semiconductor Manufacturing Co (TSMC) (TW:2330) lost 2.9% and Sony Corp (T:6758) shed 2.5%.

In China, the number of new Covid-19 cases fell to 1,886 on Monday from 2,048 the day before. The World Health Organization cautioned, however, that “every scenario is still on the table” in terms of the epidemic’s evolution.

As China’s authorities try to prevent the spread of the disease, the economy is paying a heavy price. Some cities remained in lockdown, streets are deserted, and travel bans and quarantine orders are in place around the country, preventing migrant workers from getting back to their jobs.

Many factories have yet to re-open, disrupting supply chains in China and beyond, as highlighted by Apple.

“Lifting travel restrictions is taking longer than expected. Initially we thought lockdowns would end in February and factory output would normalize in March. But that is looking increasingly difficult,” said Ei Kaku, currency strategist at Nomura Securities.

Nomura downgraded its China first-quarter economic growth forecast to 3% from a year earlier, half the pace of the fourth quarter, from its previous forecast of 3.8%.

Nomura says there was a risk it could be even weaker.

Also hurting market sentiment was news that the Trump administration is considering changing U.S. regulations to allow it to block shipments of chips to Huawei Technologies from companies such as Taiwan’s TSMC, the world’s largest contract chipmaker.

Bonds were in demand, with the 10-year U.S. Treasuries yield falling 4.2 basis point to 1.546% (US10YT=RR) after a U.S. public holiday on Monday.

Safe-haven gold also rose 0.3% to its two-week high of $1,587.00 per ounce.

In the currency market, the yen ticked up 0.15% to 109.69 yen per dollar while the risk-sensitive Australian dollar lost 0.4% to $0.6686 . The yuan was steadier for now, trading at 6.9950 yuan per dollar .

The euro, grappling with worries about sluggish growth in the euro zone, edged down 0.1% to $1.0833 (EUR=), near its 33-month low of $1.0817 touched on Monday.

Oil prices slipped on fresh concerns over the economic impact of the coronavirus outbreak in China.

Brent crude (LCOc1) fell 0.6% to $57.30 a barrel, while U.S. West Texas Intermediate (WTI) crude (CLc1) slipped 0.3% to $51.90 a barrel.

London copper prices also retreated 0.3% to $5,797 a tonne, slipping from Monday’s three-week high.


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Intesa Sanpaolo launches €4.9bn bid to buy UBI Banca


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Intesa Sanpaolo launches €4.9bn bid to buy UBI Banca <


Intesa Sanpaolo, Italy’s biggest domestic lender, has launched a €4.86bn ($5.26bn) takeover bid for its rival UBI Banca in an audacious attempt to kick-start consolidation in Italy’s fragmented banking sector.

Just before midnight on Monday local time, Turin-headquartered Intesa unveiled an all-share offer to buy Italy’s fourth-biggest lender through a series of notices detailing its plans to issue new shares to fund the deal.

If successful, the combination would create the seventh-largest bank in the eurozone with €1.1tn in assets and give Intesa an additional 3m retail, small business and private-banking clients, the company said.

Intensa has offered to pay 17 new shares for every 10 UBI Banca shares tendered. It said the bid corresponds to a value of €4.25 per share in UBI Banca, or a 27.6 per cent premium to the Bergamo-based lender’s share price at the end of last week.

Shares in UBI Banca rose 5.5 per cent in Monday’s trading and have climbed 28 per cent since the start of February. Intesa shares are up nearly 11 per cent in the same period giving the company a market value of €44bn.

“Intesa considers UBI amongst the best Italian banks . . . [it] has local entrenchment in the most dynamic regions of the country, enjoys outstanding results that have been achieved thanks to the excellent job of both its CEO and its management team, and has a sound business plan,” the lender said in a statement.

The bid makes Intesa chief executive Carlo Messina the first to act decisively among the country’s largest lenders, responding to supervisors’ repeated appeals for Italian banks to consolidate to reduce excessive competition, cut costs and boost the sector’s persistently low profitability.

The country’s banks have been on the front line of tensions between Italy and Europe, not only over bad loans during the European debt crisis but also over its expansionary budget. Investor concerns over the package caused spreads on sovereign debt to balloon in 2018, reviving fears of a vicious cycle between banks and the sovereign, known colloquially as a “doom loop”.

Intesa will have to get permission from the European Central Bank for the deal to go ahead, and negotiate with the Italian government and unions over 5,000 jobs reductions it plans as part of the deal. The acquirer forecasts the deal could lead to €730m in annual expense and revenue synergies, but will cost €1.3bn before tax to execute.


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To address competition concerns, Intensa said its offer includes a binding agreement to sell between 400 and 500 branches of the combined group to Modena-based BPER Banca.

More than a decade on from the 2008-09 financial crisis, most banks across continental Europe are still battling to revive returns amid a raft of new capital regulations and misconduct fines. The vast majority trade at a significant discount to the book value of their assets, but despite this there have been relatively few transformational deals.

Executives have become increasingly vocal about the need for consolidation after the already struggling sector was dealt a further blow when the ECB cut interest rates further into negative territory for the foreseeable future, shrinking already small margins on lending.

While keen on domestic deals, Mr Messina has been a vocal critic of cross-border European consolidation in contrast to his counterpart at Milan-based rival UniCredit, Jean Pierre Mustier. The Frenchman has explored deals with France’s Société Générale and Germany’s Commerzbank, the Financial Times has previously reported.

In the past UBI held takeover talks with Banca Popolare di Milano and Banco Popolare, before its two other rivals merged in 2016, the FT reported at the time.


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Stock Market: 3 Things Under The Radar This Week

Attention remained on China and the coronavirus this week as stocks and commodities swung on differing reports of the numbers of new cases.

Among those headlines and another busy week of earnings, investors may have missed a potential opportunity in the luxury sector, with Wall Street expressing confidence in an Italian-French conglomerate.

While Fed chief Jay Powell was on Capitol Hill, there was plenty of other comments from Fed governors.

And looking to commodities, traders may see the effects of a Chinese slowdown all through the end of the year.

Here are three things that flew under the radar this week.

1. The View is Bright at EssilorLuxottica

Turning to the luxury goods sector for investment ideas at this point in time may not sound like clear thinking, but EssilorLuxottica could be the company to turn to for serious upside.

Known for brands such as Ray-Ban, Oakley and Michael Kors, the Italian-French eyewear conglomerate was formed by a merger in late 2018 and swiftly became one of the darlings of a sector heavily exposed to the big-spending Asian consumer.

From a low of 97.38 euros at the start of 2019, the share price soared almost 50% to 144 euros by November.

The news since hasn’t been so good.

Firstly, the company was the target of a 190-million-euro fraud at a Thai factory. As a company with a market capitalization of more than 60 billion euros, this shouldn’t make a big difference, but it highlighted industry concerns about the way the company was being run with the European management teams of the two newly-merged companies clashing.

Then came the ongoing coronavirus outbreak in China, now officially called Covid-19. With entire cities in the world’s second-biggest economy cordoned off and travel severely curtailed, the luxury industry faces a major sales hit.

Chinese consumers account for more than a third of global spending on luxury goods, while consultancy Bain & Company estimated they accounted for 90% of last year’s increase in revenues to 281 billion euros.

Finally, earlier this month EU antitrust regulators opened an in-depth investigation into the company’s 7.2-billion-euro bid for Dutch opticians group GrandVision on the grounds the deal could push up prices. It will decide by June 22 whether to clear or block the deal.

EssilorLuxottica’s share price has rebounded back a touch to 138 euros, after falling to 134 euros at its low point in 2020. And Morgan Stanley (NYSE:MS) sees plenty more upside.

“EssilorLuxottica looks set to be the winning player in the consolidating and structurally growing eyewear industry,” is said in a research note this week.

The bank has a conservative 12-month price target of 150 euros. This is based on synergies from the original merger in the region of 800 million euros, at least 200 million euros ahead of company guidance; the GrandVision acquisition getting full regulatory approval by the final quarter of this year and adding another 350 million euros of synergies; and a positively skewed risk/reward basis as the stock has underperformed all other best-in-class global consumer players over the past year.

But Morgan Stanley (NYSE:MS) also sees upside to 200 euros over the next 12 months in a blue-sky scenario of impeccable execution.

2. Powell Didn’t Do All the Fed Talking

There were two days of testimony (with Q&A) from Federal Reserve Chairman Jerome Powell this week. Powell appeared before Congress for his semiannual appearance and naturally most of the Fed headlines were about the chief of the FOMC.

But there were plenty of other Fed officials offering insights.

The comments were mostly positive, chiming with Powell’s analysis that the U.S. economy still looks solid.

Cleveland Fed President Loretta Mester said Covid-19 was a risk to her forecast, but stuck by her view of GDP up 2% this year. New York Fed President John Williams (NYSE:WMB) said the U.S. economy is in a “very, very good place,” while St. Louis Fed President James Bullard said rate cuts had set the stage for a soft landing to 2% growth with no deeper slowdown.


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But Minneapolis Fed President Neel Kashkari thinks there’s plenty more Fed ammunition, suggesting the FOMC should still be cutting rates from the current level of 1.5% to 1.75%.

Monetary policy is “close to neutral or slightly accommodative today, but not very accommodative,” Kashkari said at a town hall.

As for Covid-19, “(i)f it really was large enough to hit the U.S. economy, one could imagine monetary policy responding, not to the virus itself but to just to try to help the U.S. economy manage its way through until the public health officials can get their arms around it,” he said.

And Kashkari had a Valentine’s Day wish for all the Fed Heads on Twitter.

Roses are red

Violets are blue

Last year I said there’s slack in the labor market

Today it’s still true

3. The Biggest Oil Shock Since 2008?

Oil prices managed a weekly gain on hopes that OPEC and Russian will come through with production cuts that balance the demand destruction that’s already being seen from China’s slowdown due to Covid-19.

But some are arguing that OPEC’s plan of cutting 600,000 won’t be enough to help prices when facing what could be the biggest disruption since the Financial Crisis.

“The economic shut-down in China will cause the largest negative oil demand shock since 2008,” Bjørnar Tonhaugen, Rystad Energy’s senior vice president and head of oil markets, said in a note.

“Even though the chaos unfolding in Libya has wiped out most of its oil production, and even if OPEC’s output cuts are fully applied, they will not be enough to fill the demand gap now exacerbated by the coronavirus,” Tonhaugen said.

Rystad predicts a first-quarter surplus of 700,000 bpd and a stock build of 1.3 million bpd.

And while “the third quarter looks a bit better for balances … fourth quarter balances suggest continued pressure on the market and OPEC+ despite the warranted extension of the current output agreement through year-end,” it said.


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Day Trading: 3 Things Under The Radar This Week


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Although closing Friday on a down note, stocks rallied sharply this week as the coronavirus, earnings and employment data took most of investors’ attention (along with the wild swings in Tesla). But among things that may have gone overlooked, two U.K. companies that could be surfing the sustainability wave came into view.


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The Trump administration kept coal as a talking point. And the Fed indicated that while the sidelines is still where it feels most comfortable, the impact of the coronavirus isn’t being ignored.

Here are three things that flew under the radar this week.

1. Will the Plastic Purge Create a Cardboard Boon?

With environmental and sustainability considerations playing an ever-greater role in the decisions of big institutional investors, it’s worth taking a moment to think how all those big passive bucks could move a stock that checks the right boxes.

Boxes being the operative word. Cardboard boxes, to be precise.

Two London-listed stocks offer interesting exposure to one of the great megatrends of the coming years: the shift away from plastic packaging.

Irish-based Smurfit Kappa (LON:SKG) and U.K.-based DS Smith (LON:SMDS), which is also Europe’s largest recycler of paper, both stand to benefit.

Smurfit stock rose more than 8% this week on the back of results that showed margins widening and debt (a perennial concern, given the cyclicality of the business) falling to the middle of its target range. While the breadth of its operations throws up a fair amount of problems – in the last two years it was expropriated in Venezuela and was fined $136 million for anti-competitive behavior in Italy – its core operations in Europe, the U.S. and emerging markets are solid.

DS Smith is arguably the more stable business by virtue of its concentration on fast-moving consumer goods, less prone to downturns than discretionary packages delivered by Amazon (NASDAQ:AMZN). It’s also less exposed to exotic places like Venezuela. It stands to be a big beneficiary of initiatives like that announced by U.K. supermarket chain Sainsbury’s, which promised last week to throw 1 billion pounds at getting plastic out of its supply chain, initiatives that are likely to become ever more common as the revolt against plastic spreads.

2. U.S. Sends $64 Million Canary Into Coal Mines

It sounded just like the kind of thing that would have gotten green groups all up in arms — a coal-first energy policy that conjures images of more carbon emissions in a world that needs exactly less.

Yet the U.S. Coal-FIRST — yes, in caps — initiative floated by Energy Secretary Dan Brouillette was clever enough in language that it got the attention it wanted without the bad press.

What Brouillette really announced was a $64 million “Flexible, Innovative, Resilient, Small, Transformative” initiative to develop the coal plant of the future needed to provide secure and reliable power to the U.S. grid.

“Coal is a critical resource for grid stability that will be used in developing countries around the world well into the future as they build their economies,” Brouillette said in a statement issued by the Department of Energy.

While from the text we could see where the energy secretary was going, those hearing the policy the first time — an announcement Brouillette chose to make during a speech at the Atlantic Council in Washington Friday morning — would be forgiven for thinking that President Donald Trump was trying to throw coal miners yet another lifeline ahead of his November reelection bid.

As Keith Johnson at foreignpolicy.com observed in an October post, “Trump came into the White House vowing to end the Obama administration’s so-called war on coal and Make Anthracite Great Again.”

“Instead, Trump is overseeing a cascading collapse of America’s coal industry, a trend that could have political consequences for him in the 2020 U.S. presidential election,” Johnson wrote, noting that there were eight bankruptcies filed by coal mining companies last year alone.

To be sure his words weren’t taken out of context, Brouillette said soon after announcing his Coal-FIRST policy that “the efforts we’re undertaking is not to subsidize the industry and preserve their status, if you will, as a large electricity generator.”

“It is simply to make the product cleaner and to look for alternative uses for this product or this commodity,” he said. “No one is going to deny the fact or argue with the point that coal as a percentage of U.S. electricity generation is declining and will probably continue to decline.”

“The evolving U.S. energy mix requires cleaner, more reliable, and highly efficient plants,” Steven Winberg, the DOE assistant secretary for fossil, added in the statement. “Technologies developed for the Coal FIRST initiative will lead to just that — reliable, highly efficient plants with zero or near-zero emissions.”

3. Fed Factoring in Coronavirus

For months, traders have been eager to find out what additional factors, apart from the pace of inflation, will drive a material risk to the Federal Reserve’s outlook and force it off the sidelines. But Fed Chairman Jerome Powell has given little away.

That all changed early this week when the Fed chief identified a new risk to the central bank’s outlook on the economy: the coronavirus.

“More recently, possible spillovers from the effects of the coronavirus in China have presented a new risk to the outlook,” Powell said in the latest monetary policy report, submitted to Congress on Friday

“The recent emergence of the coronavirus, however, could lead to disruptions in China that spill over to the rest of the global economy. Amid weak economic activity and dormant inflation pressures, foreign central banks generally adopted a more accommodative policy stance,” the Fed chairman added.

The Fed’s worries about the risk to its outlook are not without merit, with analysts predicting that the virus will do most of its damage in the first quarter of this year.

Goldman Sachs said the impact of the disease would lower global GDP by up to 2% in the first quarter, 1% directly from China and about 1% from spillover effects.

Whether the impact of the virus will represent a material risk to the U.S. central bank’s outlook remains a hot topic of debate.

“The near-term impact is quite large,” Goldman Sachs said. “What happens to 2020 as a whole really depends on how quickly the episode is brought under control.”

The Federal Reserve fingerprints are all over the more-than-decade-long bull run in stocks. Its efforts to steady the repo market, which began in October, have coincided with a sharp upswing in stocks. But those hoping for the Fed to act sooner rather than later could be left disappointed.

“The new coronavirus outbreak abroad has created some new risks to the near-term external growth backdrop, but there is little apparent reason for monetary policymakers to consider rate cuts at the moment, and we continue to expect the Fed to sit on the sidelines through 2020,” RBC said in a note.




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The investments offered by the broker will dictate two things: whether your investment needs will be satisfied, and how much you’ll pay in commissions. Pay careful attention to the commissions associated with your preferred investments:

Individual stocks: You’ll typically pay a per-trade commission of $4 to $7. Some brokerages also offer per-share pricing.

Options: Options trades often incur the stock trade commission plus a per-contract fee, which usually runs $0.15 to $1.50. Some brokers charge only a commission or only a contract fee.

Mutual funds: Some brokers charge a fee to purchase mutual funds. You can limit mutual fund transaction costs or avoid them completely by selecting a broker that offers no-transaction-fee mutual funds. (Mutual funds also carry internal fees called expense ratios. These are charged not by the broker, but by the fund itself.)

ETFs: ETFs trade like a stock and are purchased for a share price, so they are often subject to the broker’s stock trade commission. But many brokers also offer a list of commission-free ETFs. If you plan to invest in ETFs, you should look for one of these brokers.

Bonds: You can purchase bond mutual funds and ETFs at no charge by using no-transaction-fee mutual funds and commission-free ETFs. Brokers may charge a fee to purchase individual bonds, with a minimum and maximum charge.

Pay attention to account minimums… You can find highly ranked brokers with no account minimum. But some brokers do require a minimum initial investment, and it can skew toward $500 or more. Many mutual funds also require similar minimum investments, which means even if you’re able to open a brokerage account with a small amount of money, it could be a struggle to actually invest it.

Watch out for account fees… You may not be able to avoid account fees completely, but you can certainly minimize them. Most brokers will charge a fee for transferring out funds or closing your account. If you’re transferring to another broker, that new company may offer to reimburse your transfer fees, at least up to a limit.

Most other fees can be sidestepped by simply choosing a broker that doesn’t charge them, or by opting out of services that cost extra. Common fees to watch out for include annual fees, inactivity fees, trading platform subscriptions and extra charges for research or data.

Consider your trading style and tech needs… If you’re a beginner investor, you probably won’t need extras, like an advanced trading platform. But you may want an education and a little hand-holding. This could include videos and tutorials on the broker’s website, or in-person seminars at branches. Many brokers offer these services free to account holders.

Active traders, on the other hand, will want to look for a brokerage that supports that kind of frequency. That includes weighing a broker’s trading platforms, analysis tools, research and data offerings in addition to commissions — including discounts for high-volume traders — and fees.

Plenty of high-quality online brokers offer free demo access to trading platforms.

Take advantage of promotions… Online brokers, like many companies, frequently entice new customers with deals, offering a number of commission-free trades or a cash bonus on certain deposit amounts.

It isn’t wise to choose a broker solely on its promotional offer — a high commission over the long term could easily wipe out any initial bonus or savings — but if you’re stuck between two options, a promotion may sway you one way or the other.


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Wall Street Slips After Jobs Report


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Wall Street pulled back from record levels on Friday, as investors assessed the U.S. employment report that showed jobs growth accelerated in January but included a downward revision to some previous numbers.

Nonfarm payrolls increased by 225,000 jobs last month, the Labor Department’s data showed, much higher than 160,000 jobs additions expected by economists polled by Reuters. However, the economy created 514,000 fewer jobs between April 2018 and March 2019 than originally estimated, suggesting job growth could significantly slowdown this year.

“Where the market is right now, it likes to see an economy that’s not too hot and not too cold because a much stronger economy suggests higher interest rates,” said Rick Meckler, partner at Cherry Lane Investments, a family investment office in New Vernon, New Jersey.

“When you get the kind of upward move in markets, it’s not surprising to see people wanting to go into the weekend quite as long.”

Technology stocks, which outperformed broader markets this week, slipped 0.7%, weighing the most on the S&P 500. A strong four-day rally this week has put the benchmark index on pace for its best week in eight months as investors took comfort from China’s efforts to limit the economic damage from the coronavirus outbreak.

The new infections in mainland China on Thursday were down from Wednesday and Tuesday’s figures, but experts warned it was too early to identify a trend.

At 9:48 a.m. ET, the Dow Jones Industrial Average was down 0.58% at 29,208.83. The S&P 500 fell 0.44% to 3,331.09 and the Nasdaq Composite dropped 0.56% to 9,519.02.

More than 300 S&P 500 companies have reported fourth-quarter results so far, of which about 70% have topped earnings estimates, according to IBES data from Refinitiv.

Take-Two Interactive Software Inc (O:TTWO) slumped 10.6% after the videogame publisher missed estimates for quarterly adjusted revenue. AbbVie Inc gained 4.3% after the drugmaker forecast 2020 earnings above analysts’ expectations.

Uber Technologies Inc (N:UBER) shares gained about 5.7% after the ride-hailing company moved forward by a year its target to achieve a measure of profitability to the fourth quarter of 2020. Declining issues outnumbered advancers for a 2.51-to-1 ratio on the NYSE and a 2.64-to-1 ratio on the Nasdaq.

The S&P index recorded 18 new 52-week highs and one new low, while the Nasdaq recorded 31 new highs and 31 new lows.








Amazon Says It Will Create 15,000 Jobs In Bellevue

StockMarketNews.Today — Amazon said it expects to bring the 15,000 jobs to Bellevue over the next few years. More than 2,000 employees currently work in Bellevue, and the company has about 700 job openings in the city.

The company opened its first office building in Bellevue in 2017. The city is also where Amazon got its start. Amazon CEO Jeff Bezos founded the company in 1994 out of a 1,540-square-foot house in West Bellevue.

Amazon, which is headquartered in nearby Seattle, has continued to expand there despite rising tensions with local officials. Last month, the Seattle City Council council passed a bill that establishes new restrictions on corporate donations in local elections, which serves as a blow to Amazon, after it donated a record $1.5 million into Seattle’s city council races in 2019. Additionally, Seattle city council member Kshama Sawant has recently reignited efforts to enact a “head tax” on the city’s largest companies, such as Amazon, with the goal of using it to fight Seattle’s housing crisis.

The company has been growing its overall headcount and footprint. In its annual filing submitted last week, Amazon disclosed that it now has 798,000 workers across the globe, which is a 23% increase from the year-ago period. On the company’s fourth-quarter earnings call, Amazon CFO Brian Olsavsky said some of the hires were delivery workers, as it builds out one-day and same-day delivery for Prime subscribers.

Amazon is also growing in New York, where it recently signed a deal to lease more than 335,000 square feet of office space in Hudson Yards and expects to hire more than 1,500 employees. The move comes after Amazon abandoned its efforts to build a second headquarters in New York’s Long Island City neighborhood.

The company is also building out operations in northern Virginia, where it’s building its second headquarters, dubbed HQ2. So far, Amazon has hired 400 employees to work out of leased offices in Crystal City, Virginia. It also plans to bring 5,000 jobs to Nashville, Tennessee, where it expects to build two towers.







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Money Invested: $1,300 | Time Invested: 72 Hours | Money Earned (30 days): $7,742

How To Make Money In Affiliate Marketing: Affiliate marketing is the process of earning a commission by promoting other people’s (or company’s) products. You find a product you like, promote it to others and earn a piece of the profit for each sale that you make. Learn More …



3. Make Extra Money Online Simply By Sharing Your Opinions

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Money Invested: $1 | Time Invested: 46 Hours | Money Earned (30 days): $429

How To Make Money by Sharing Your Opinion: A Review ( Opinion ) is an evaluation of a publication, service, or company such as a movie, video game, musical composition, book; a piece of hardware like a car, home appliance, or computer; or an event or performance, such as a live music concert, play, musical theater show, dance show, or art exhibition. Learn More …



4. Make Money With an Online Drop Shipping Business

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Money Invested: $75 | Time Invested: 144 Hours | Money Earned (30 days): $2,915

How To Make Money With an Online Drop Shipping Business: Drop shipping is a business model where you send your customers’ orders to a manufacturer or wholesaler, and they send the products directly to your customer. Learn More …





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German Industry Output Suffers Biggest Slump Since 2009

Stock Market NewsGerman industrial output registered its biggest drop in more than a decade in December, highlighting the weakness of the manufacturing sector that is dragging on overall growth in Europe‘s largest economy.

Industrial production tumbled by 3.5% on the month, undershooting expectations for a 0.2% fall, figures released by the Statistics Office showed. The drop was the biggest since January 2009, a Statistics Office official said.

The November output reading was revised to an increase of 1.2% after a previously reported 1.1% rise.

Separate trade figures showed seasonally adjusted exports edged up by 0.1% on the month while imports fell by 0.7% in December.







⇑⇓ Best Trading Platform Europe ⇓⇑


StockMarketNews.Today — what is the best stock trading platform in Europe for 2020? ….  How To Choose The Best Online Broker in Europe { 2020 } …


Best Online Trading Platform. Start Trading Now or Try a FREE Demo Account.


To evaluate brokers, you should look at the following factors:

>>> Commissions
>>> Account Minimum
>>> Account Fees
>>> Your Trading Style and Tech Needs
>>> Promotions

Look at commissions on the investments you’ll use most… Brokers generally offer a similar menu of investment options: individual stocks, options, mutual funds, exchange-traded funds, and bonds. Some will also offer access to futures trading and forex (currency) trading.


A Beginner’s Guide to the Stock Market: Everything You Need to Start Making Money Today


The investments offered by the broker will dictate two things: whether your investment needs will be satisfied, and how much you’ll pay in commissions. Pay careful attention to the commissions associated with your preferred investments:

Individual stocks: You’ll typically pay a per-trade commission of $4 to $7. Some brokerages also offer per-share pricing.

Options: Options trades often incur the stock trade commission plus a per-contract fee, which usually runs $0.15 to $1.50. Some brokers charge only a commission or only a contract fee.

Mutual funds: Some brokers charge a fee to purchase mutual funds. You can limit mutual fund transaction costs or avoid them completely by selecting a broker that offers no-transaction-fee mutual funds. (Mutual funds also carry internal fees called expense ratios. These are charged not by the broker, but by the fund itself.)

ETFs: ETFs trade like a stock and are purchased for a share price, so they are often subject to the broker’s stock trade commission. But many brokers also offer a list of commission-free ETFs. If you plan to invest in ETFs, you should look for one of these brokers.

Bonds: You can purchase bond mutual funds and ETFs at no charge by using no-transaction-fee mutual funds and commission-free ETFs. Brokers may charge a fee to purchase individual bonds, with a minimum and maximum charge.

Pay attention to account minimums… You can find highly ranked brokers with no account minimum. But some brokers do require a minimum initial investment, and it can skew toward $500 or more. Many mutual funds also require similar minimum investments, which means even if you’re able to open a brokerage account with a small amount of money, it could be a struggle to actually invest it.

Watch out for account fees… You may not be able to avoid account fees completely, but you can certainly minimize them. Most brokers will charge a fee for transferring out funds or closing your account. If you’re transferring to another broker, that new company may offer to reimburse your transfer fees, at least up to a limit.

Most other fees can be sidestepped by simply choosing a broker that doesn’t charge them, or by opting out of services that cost extra. Common fees to watch out for include annual fees, inactivity fees, trading platform subscriptions and extra charges for research or data.

Consider your trading style and tech needs… If you’re a beginner investor, you probably won’t need extras, like an advanced trading platform. But you may want an education and a little hand-holding. This could include videos and tutorials on the broker’s website, or in-person seminars at branches. Many brokers offer these services free to account holders.

Active traders, on the other hand, will want to look for a brokerage that supports that kind of frequency. That includes weighing a broker’s trading platforms, analysis tools, research and data offerings in addition to commissions — including discounts for high-volume traders — and fees.

Plenty of high-quality online brokers offer free demo access to trading platforms.

Take advantage of promotions… Online brokers, like many companies, frequently entice new customers with deals, offering a number of commission-free trades or a cash bonus on certain deposit amounts.

It isn’t wise to choose a broker solely on its promotional offer — a high commission over the long term could easily wipe out any initial bonus or savings — but if you’re stuck between two options, a promotion may sway you one way or the other.


Best Online Trading Platform. Start Trading Now or Try a FREE Demo Account.


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◊ Best Stock Trading Platform In Europe {2020} : Plus500 Review ◊


Plus500 is a streamlined broker that focuses on trading in a wide range of financial markets with relatively low spreads and no commissions but without offering many extra services. Plus500 has been in the forex and CFD business since 2008. They are registered in the U.K. and licensed by the Financial Conduct Authority (FCA).

The company offers access to a comprehensive product line including forex, stock indexes, equities, commodities, cryptocurrencies, ETFs and options. Plus500 is the first broker to introduce a bitcoin CFD in 2013. The company does not charge commissions on any of its trades.

All costs are contained within the spread for each of more than 2,000 trading instruments offered on Plus500’s WebTrader platform. Plus500 Ltd. (PLUS.L) is a publicly traded company on the AIM section of the London Stock Exchange since 2013 with a £1.73 billion ($2.25 billion) market capitalization and clients in more than 50 countries around the world. Plus500 offers access to more than 2,000 trading instruments.


START TRADING NOW OR TRY A FREE DEMO ACCOUNT


Trust … The company is registered with the Financial Conduct Authority (FCA), CySEC, ASIC, FSCA, FMA, MAS, and the ISA, which provides good accountability and visibility. The company is required to take steps to ensure client funds are not comingled with corporate funds – ensuring that client money and assets are protected in the unlikely event that Plus500 becomes insolvent – by holding those funds in segregated accounts at regulated banks.

If Plus500 defaults, any shortfall of funds of up to £50,000 may be compensated for under the Financial Services Compensation Scheme (FSCS). If the custodian bank holding client funds goes into liquidation, any shortfall of funds of up to £85,000 may be compensated for under the FSCS.

Plus500 also offers Negative Balance Protection, ensuring that clients cannot lose more than they have put into their account. Guaranteed stop losses can be used on some instruments depending on market conditions but they are subject to a wider spread.

The company does not charge commissions on any of its trades. All costs are contained within the spread for each of more than 2,000 trading instruments offered on Plus500’s WebTrader platform. Large volume traders do not get a trading discount at Plus500 and the spread is the same whether you trade one lot or 1,000 lots.

There are no charges for normal withdrawals or terminating an account. However, inactivity fees kick in after an account has been idle for three months. Beginning traders can open an account with as little as £100.

Traders can qualify for a “professional” account, which offers a higher level of maximum leverage, but the costs are the same. Investors with a professional account may increase their maximum leverage ten-fold, from 1:30 to 1:300.

Plus500 also offers access to options trading on many markets. These are very similar to plain call and put options traded on exchanges, but they are not standardized which means that the option premium can be customized for your risk tolerance and strategy objectives.


START TRADING NOW OR TRY A FREE DEMO ACCOUNT


Commodity-Trading-today





Best Stock Market Sectors For 2020

♦ Stock Market Predictions For 2020 ♦ StockMarketNews.Today — After another big year for the stock market and the U.S. economy in 2019, investors are looking ahead to 2020 to determine which sectors will lead the next phase of the… Read More ›





  • Best Books For Making Money { 2020 }

    Best Books For Making Money ◊ #1 – The Book on Making Money After skipping college, Steve Oliverez worked a series of low-paying jobs before setting a remarkable goal for himself – to double his income every year. In… Read More ›

  • The Best Movies Related To Stock Market {2020}

    Top Movies Related To Stock Market {2020} #1 – The Big Short The Big Short is a 2015 American biographical comedy-drama film directed by Adam McKay. Written by McKay and Charles Randolph, it is based on the 2010 book The… Read More ›

  • Best Stock Market Books For Beginners {2020}

    Best Stock Market Books For Beginners {2020} Amazon #1 – The Intelligent Investor. (Revised Edition) This classic text is annotated to update Graham’s timeless wisdom for today’s market conditions… The greatest investment advisor of the twentieth century, Benjamin Graham, taught… Read More ›

  • How To Make Money Online by Investing Little Money

    How To Make Money Online by Investing Little Money – StockMarketNews.Today ◊ Internet offers many opportunities to make a lot of money. Whether you’re looking to make some fast cash, or you’re after long-term, more sustainable income-producing results, there… Read More ›

  • How To Make Money During Stock Market Correction?

    How to Deal With a Stock Market Correction ◊ Stock market corrections are scary but normal. In fact, they’re a sign of a healthy market in most… Read More ›

  • How To Make Money In Online Stock Trading?

    Investing in the stock market can be a great way to have your money make money…  Stock trading is not a risk-free activity, and some losses are inevitable. However, with substantial research and investments in the right… Read More ›





Goldman Sachs Estimates Modest Hit To 2020 Global Growth From Coronavirus

Today’s Stock Market News — Goldman Sachs says 2020 global growth will take a modest hit from the outbreak of coronavirus, assuming an aggressive response from authorities in China and elsewhere to bring the rate of new infections down sharply by the end of the first quarter.

Annual-average global GDP growth in 2020 will be downgraded by 0.1 to 0.2 percentage points, the bank estimated.




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Best Stock Market Sectors For 2020


After another big year for the stock market and the U.S. economy in 2019, investors are looking ahead to 2020 to determine which sectors will lead the next phase of the decade-long bull market. The technology sector has once again been the top-performing sector in 2019, while energy lagged behind the field. In 2020, analysts see more room for upside ahead in select market sectors.

Top-Performing Market Sectors of 2020.  ( By Savita Subramanian )

Financials
The Financial Select Sector SPDR (XLF) exchange-traded fund gained 29.8% in 2019, and Subramanian is anticipating another big year from the sector in 2020. Subramanian says the sector is much less credit-sensitive in 2020 than it was during the financial crisis and has seemingly gotten little recognition in the market for dramatic improvements in quality and cash returns.

Despite the sector’s relatively high quality and yield, the financial sector trades at the steepest forward earnings multiple discount to the S&P 500 of any sector.

Bank of America has an “overweight” rating for the financial sector.

Industrials
Even after the Industrial Select Sector SPDR ETF (XLI) gained 26.6% in 2019, Subramanian says the industrial sector trades at a recession-level earnings multiple.

She says industrials could re-rate to a higher valuation in 2020 if the economy remains strong, trade risks ease, capital expenditures ramp and the Institute of Supply Management’s Purchasing Managers Index bottoms. In addition, the climate of elevated geopolitical tensions with China, the Middle East and other regions should support the U.S. defense budget in the near term, a positive backdrop for industrials.

Bank of America has an “overweight” rating for the industrial sector.

Technology
The Technology Select Sector SPDR ETF (XLK) gained 45.3% in 2019, beating all other market sectors by more than 15%.

In a technology-driven world, Subramanian says the tech sector will once again be a solid performer in 2020. However, after such a strong run in 2019, Subramanian says its prudent for investors to dial back their exposure and keep expectations realistic in 2020. If the recent rotation to value stocks carries over into next year, she says high-flying software stocks could be hit especially hard.

Bank of America has a “market-weight” rating for the technology sector.

Communication Services
Three of the top holdings in the Communication Services SPDR ETF (XLC) are “FANG” stocks Alphabet (GOOG, GOOGL), Facebook (FB) and Netflix (NFLX).

Subramanian says the FANG group will likely continue to face regulatory scrutiny related to user data in 2020, but likely not as much as in 2019. At the same time, the 2020 U.S. election should provide a shot in the arm for both online and traditional advertising. Subramanian says the sector offers investors both yield and growth, a rare combination in today’s market.

Bank of America has a “market-weight” rating for the communication services sector.

Health Care
The health care sector is currently trading at about an 11% forward earnings multiple discount to the overall S&P 500, well below its historical 11% premium.

Subramanian says the sector has both a compelling valuation and impressive fundamentals. Unfortunately, health care stocks did not fare well during the last election season in 2015 and 2016 due to policy uncertainty. Subramanian says election-related headline risks will be elevated in 2020, but passage of disruptive policies such as Medicare for All appears to be unlikely.

Regardless, Bank of America has a “market-weight” rating for the health care sector.

Energy
After another year of underperformance in 2019, the Energy Select Sector SPDR ETF (XLE) is now down 20.1% overall over the past five years.

Fortunately, Subramanian says the extended weakness has created deep value in the space heading into 2020. In addition, she says exploration and production companies are focusing more on cash flow and shareholder returns than production growth. Stock selection within the sector is growing increasingly important given younger investors’ preference for companies with environmental, social and governance (ESG) awareness.

Bank of America has a “market-weight” rating for the energy sector.

Utilities
The Utilities Select Sector SPDR ETF (XLU) gained 21.6% in 2019. Subramanian says utility stocks provide a great source of yield for investors, and the predictability of utility earnings make the sector relatively immune to macroeconomic instability.

The sector’s current dividend payout ratio is roughly in line with its historical average, suggesting payouts are sustainable but yield upside is limited. Unfortunately, the sector’s relative valuation compared to the overall S&P 500 is about 20% higher than its historical average, potentially capping valuation upside.

Bank of America has an “overweight” rating for the utilities sector.










 

Today’s Stock Market News { 1 February, 2020 }

Today’s Stock Market News — U.S. equity markets wiped out their gains for the year on Friday, following European and Asian shares lower as concern escalated about the impact of the coronavirus on global growth.

The death toll from the epidemic had risen to 213, Beijing said, with another 9,811 confirmed cases worldwide and a further 15,000 suspected. The US announced restrictions on entry to the country for foreigners who have recently travelled to China, and airlines cancelled flights to China.

The US equity benchmark, the S&P 500 index, closed down 1.8 per cent and the Dow Jones Industrial Average fell more than 2 per cent. Both registered their biggest weekly percentage declines since August.

Weighing on European stocks alongside coronavirus fears was economic data that showed the eurozone’s fourth-quarter growth in 2019 was only 0.1 per cent, below expectations of 0.2 per cent.

Caterpillar, the world’s biggest construction and mining equipment maker, cast a further shadow, after it reported lower sales for the past quarter and forecast worse than expected earnings for this year. Strong earnings from Amazon limited the decline of the tech-weighted Nasdaq Composite index to 1.69 per cent.

The coronavirus outbreak will reduce US economic growth by 0.4 percentage points in the first quarter in the face of declining numbers of tourists from China and exports to Asia, according to Goldman Sachs economists.

“The market reaction may deepen further if the virus spreads further,” said Kristina Hooper, chief global market strategist for Invesco. “The most recent revelation of new infections in China and elsewhere suggests that the market will be faced with further downside risks.”

With Friday’s drop, the S&P 500 wiped out its gains for 2020, having been up 3.1 per cent at its highest close earlier this month. The benchmark index is now down 0.2 per cent year-to-date, while the Dow is down 1 per cent and the Nasdaq Composite’s 2020 gain has been trimmed to 2 per cent.

Bourses in Paris and Frankfurt earlier closed down more than 1 per cent, while the Stoxx Europe 600 was 1.1 per cent lower, leaving the continent-wide benchmark down 3 per cent for the week.

Eurostat data revealed the eurozone ended last year with a whimper, as the French and Italian economies both shrank unexpectedly, denting hopes that the region was poised to rebound from its recent sluggish performance.

Government bonds in the eurozone extended their gains this week following the disappointing growth data, pushing yields to fresh lows for the year. The yields on the 10-year German Bunds and UK gilts were down 2 basis point to minus 0.42 per cent and 0.53 per cent, respectively.

US Treasury yields also sank. The yield on the benchmark 10-year Treasury note fell to 1.50 per cent, the lowest since October. The 30-year Treasury bond yield fell below 2 per cent, the lowest since September.

Bonds had already rallied significantly in recent days as fear over the spread of coronavirus fuelled demand for haven assets.

Traders were pricing in at least one rate cut by the Federal Reserve in July, with indications of another rate cut increasing for later this year.

“The market impact of the coronavirus outbreak in China . . . increasingly resembles last year’s trade-war-driven turmoil in May and August,” said Jonas Goltermann at Capital Economics. “But unless the fallout from the epidemic escalates significantly, it is hard to see the sharp falls in bond yields persisting.”

Worries surrounding the coronavirus have consequently hit Asian markets. Hong Kong’s Hang Seng closed down 0.5 per cent on Friday while South Korea’s Kospi ended its session 1.3 per cent lower.




Traders Pay Up For Protection Against Sharp Falls In US Stocks

Stock Market News Today— Traders have been scrambling to protect themselves from a collapse in US stocks, spooked by the coronavirus outbreak, the looming presidential race and the sheer strength of last year’s rally.

The US equity market climbed 29 per cent in 2019 and started this year strongly, but the spreading nervousness has sent the S&P 500 index down by about 2.5 per cent since the middle of the month.

The Cboe Volatility index — known as the market’s “fear gauge” — suggests that traders are now bracing for sharper moves. The 10-day moving average volume of Vix call options — derivatives that allow traders to benefit from a spike in turbulence — has increased from 200,000 traded at the start of January to about 400,000.

The Vix itself has climbed from a low of about 12 points in mid-January to over 18 on Thursday, when the S&P 500 index was off by 0.7 per cent by midday in New York.

There are many negative factors “that are screaming for a big stock sell-off”, said Stephen Aniston, president of vixcontango.com, a volatility trading analytics provider.

Activity in put options linked to the US stock market, which offer investors protection against equities slumping, has also been rising in recent weeks as the spreading coronavirus and the approaching US presidential election has investors on edge.

Trading in S&P 500 put options has climbed to levels not seen since September. The 10-day moving average for put volume on the S&P 500 has gone from 720,000 at the start of January to 920,000, again the highest since October.

Traders said the flurry of hedging activity is similar to October 2018, when Federal Reserve chair Jay Powell’s remarks on interest rate increases and “quantitative tightening” rattled the market, and also in February 2018, when Vix-linked funds hit trouble.

A slide in government bond yields and a rise in gold prices are further signs of investors’ sharpened appetite for safe assets, traders noted. The benchmark 10-year US Treasury yield sank to a four-month low below 1.55 per cent on Thursday, while gold has nudged above $1,580 a troy ounce.

The upcoming US presidential election has also prompted some investors to buy insurance against market declines. Senator Bernie Sanders recently surpassed former US vice-president Joe Biden in a poll on the popular political betting site PredictIt for the first time, just days ahead of the first caucus for the 2020 Democratic presidential nomination.

A Deutsche Bank poll indicated that 90 per cent of clients thought that a victory for Mr Sanders would be negative for the US stock market. The left-leaning US senator from Vermont is in the lead with a 39 per cent chance of winning the Democratic nomination, according to bets on PredictIt. Data gathered by Real Clear Politics has him ahead in Iowa, which casts the first votes of the 2020 campaign next week.

“The market is going to start to price in some serious probability of a leftwing Democratic win, which will hit stocks quite a bit,” Mr Aniston said.

Investors are also worried that underwhelming corporate profits will unsettle the stock market, given how far and fast it rallied over the past year. “We now see the market fully valued, particularly within US equities. This is not going to persist indefinitely,” warned Erin Browne, a managing director at Pimco.




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Best Stock Trading Platform In Europe {2020}



StockMarketNews.Today — what is the best stock trading platform in Europe for 2020? ….  How To Choose The Best Online Broker in Europe { 2020 } …


Best Online Trading Platform. Start Trading Now or Try a FREE Demo Account.


To evaluate brokers, you should look at the following factors:

>>> Commissions
>>> Account Minimum
>>> Account Fees
>>> Your Trading Style and Tech Needs
>>> Promotions

Look at commissions on the investments you’ll use most… Brokers generally offer a similar menu of investment options: individual stocks, options, mutual funds, exchange-traded funds, and bonds. Some will also offer access to futures trading and forex (currency) trading.


A Beginner’s Guide to the Stock Market: Everything You Need to Start Making Money Today


The investments offered by the broker will dictate two things: whether your investment needs will be satisfied, and how much you’ll pay in commissions. Pay careful attention to the commissions associated with your preferred investments:

Individual stocks: You’ll typically pay a per-trade commission of $4 to $7. Some brokerages also offer per-share pricing.

Options: Options trades often incur the stock trade commission plus a per-contract fee, which usually runs $0.15 to $1.50. Some brokers charge only a commission or only a contract fee.

Mutual funds: Some brokers charge a fee to purchase mutual funds. You can limit mutual fund transaction costs or avoid them completely by selecting a broker that offers no-transaction-fee mutual funds. (Mutual funds also carry internal fees called expense ratios. These are charged not by the broker, but by the fund itself.)

ETFs: ETFs trade like a stock and are purchased for a share price, so they are often subject to the broker’s stock trade commission. But many brokers also offer a list of commission-free ETFs. If you plan to invest in ETFs, you should look for one of these brokers.

Bonds: You can purchase bond mutual funds and ETFs at no charge by using no-transaction-fee mutual funds and commission-free ETFs. Brokers may charge a fee to purchase individual bonds, with a minimum and maximum charge.

Pay attention to account minimums… You can find highly ranked brokers with no account minimum. But some brokers do require a minimum initial investment, and it can skew toward $500 or more. Many mutual funds also require similar minimum investments, which means even if you’re able to open a brokerage account with a small amount of money, it could be a struggle to actually invest it.

Watch out for account fees… You may not be able to avoid account fees completely, but you can certainly minimize them. Most brokers will charge a fee for transferring out funds or closing your account. If you’re transferring to another broker, that new company may offer to reimburse your transfer fees, at least up to a limit.

Most other fees can be sidestepped by simply choosing a broker that doesn’t charge them, or by opting out of services that cost extra. Common fees to watch out for include annual fees, inactivity fees, trading platform subscriptions and extra charges for research or data.

Consider your trading style and tech needs… If you’re a beginner investor, you probably won’t need extras, like an advanced trading platform. But you may want an education and a little hand-holding. This could include videos and tutorials on the broker’s website, or in-person seminars at branches. Many brokers offer these services free to account holders.

Active traders, on the other hand, will want to look for a brokerage that supports that kind of frequency. That includes weighing a broker’s trading platforms, analysis tools, research and data offerings in addition to commissions — including discounts for high-volume traders — and fees.

Plenty of high-quality online brokers offer free demo access to trading platforms.

Take advantage of promotions… Online brokers, like many companies, frequently entice new customers with deals, offering a number of commission-free trades or a cash bonus on certain deposit amounts.

It isn’t wise to choose a broker solely on its promotional offer — a high commission over the long term could easily wipe out any initial bonus or savings — but if you’re stuck between two options, a promotion may sway you one way or the other.


Best Online Trading Platform. Start Trading Now or Try a FREE Demo Account.


 

Stock Market: Microsoft Earnings Preview


♦Microsoft Earnings Preview♦


Stock Market —- Microsoft Stock Forecast 2020

* Reports Q2, 2020 results on Wednesday Jan. 29, after the market close

* Revenue Expectation: $35.67 billion

* EPS Expectation: $1.32

When Microsoft Corporation (NASDAQ:MSFT) releases its latest quarterly earnings today, it will provide investors with confidence that one of the bull market’s dominant bets remains intact.

Following a massive transformation under its Chief Executive Satya Nadella, Microsoft has become one of the most powerful players in the fast-growing cloud-computing market, commanding the segment’s second largest market share, with only Amazon.com (NASDAQ:AMZN) ahead.

More than five years ago, Nadella began to diversify Microsoft’s revenue away from its traditional growth engines — Windows and Office — by investing heavily in data centers and other infrastructure to help corporate customers run applications and store their data.

The growth in this market continues unabated for Microsoft, powering its operating income. For the quarter that ended on Dec. 31, analysts’ consensus forecast expects that Microsoft will produce about 10% growth in sales, while profit should surge by 20% to $1.32 a share.

Revenue from the company’s Azure cloud services rose 59% in the previous period, while sales of the subscription-based Office 365 for corporate customers, Microsoft’s other major cloud business, jumped 25%. Microsoft’s Intelligent Cloud segment now comprises more than 30% of the company’s overall revenue base.

We believe this strength will once again be on display as the company continues to win both large and small clients. In October, the Pentagon awarded Microsoft the Joint Enterprise Defense Infrastructure, or JEDI, contract that could be worth up to $10 billion over the next decade.

Large Cloud Deals Keep Coming
Microsoft’s win for this large government work shows that how quickly the Redmond, Washington-based company is capturing market share, posing a serious threat to Amazon’s dominance.

The latest deal comes after many large brands signed agreements to use Microsoft’s Azure cloud software, including grocer Kroger Company (NYSE:KR), AT&T Inc (NYSE:T), Walgreens Boots Alliance (NASDAQ:WBA) and oil giant Exxon Mobil (NYSE:XOM).

These contracts provided most of the fuel for the powerful rally in Microsoft shares in the past year, setting it apart from other large-cap legacy tech companies, such as International Business Machines (NYSE:IBM).

Microsoft shares—which closed yesterday at $165.46—are up more than 50% in the past year. This leap has pushed the company’s market value to $1.26 trillion, making it one of the world’s most valuable corporations.

The big question for investors now is how far can this rally go? At almost 31 times forward earnings, Microsoft’s shares are selling at a premium when compared to many top tech stocks. They also carry the highest multiple the stock has commanded in more than 15 years.

In our view, the factors that supported Microsoft shares over the past 12 months are still very much in play. The cloud computing market is expected to grow from $285 billion in 2017 to $411 billion by 2020. That segment alone is big enough to drive the company’s revenue growth for the next three to four years, according to Microsoft executives.

Coupled with cloud momentum, the tech giant is also benefiting from strong PC sales. Fourth-quarter sales of personal computers were the best the industry has seen in years, according to data released last week by market research firms IDC and Gartner.

Bottom Line

As investors fret about the global economic outlook and the longevity of this bull cycle, Microsoft’s fundamentals make it a safe bet in the tech space. We believe Microsoft’s earnings momentum will continue as it expands its market share in the cloud computing segment while maintaining its leading position in legacy software products such as Windows and Office.

This durable advantage will help the company achieve sustained, double-digit growth in revenue, earnings per share and free cash flow, making it a reliable tech stock to own over the long term.


START TRADING NOW OR TRY A FREE DEMO ACCOUNT


Microsoft Stock Forecast 2020


Stock Market: Economic Calendar – Top 5 Things to Watch This Week



Stock Market — Here’s what you need to know to start your week.


Coronavirus outbreak
Market participants are keeping a wary eye on developments surrounding the coronavirus outbreak which has infected more than 2,000 people, the vast majority in China where 56 people have died. The virus has also spread to the U.S., Thailand, South Korea, Japan, Australia, France and Canada.

With stocks close to all-time highs investors are fearful that the newly identified virus could develop into something worse, like the 2003 SARS epidemic.

“Markets hate uncertainty and the virus has been enough to inject uncertainty in the markets,” said David Carter, chief investment officer at Lenox Wealth Advisors in New York.

The World Health Organization has stopped short of calling the outbreak a global health emergency, but some health experts question whether China can continue to contain the epidemic.

More FAANG results
While last week’s Q4 earnings from Netflix (NASDAQ:NFLX) underwhelmed Wall Street, analyst hopes are still high for the other FAANGs – Facebook (NASDAQ:FB), Apple (NASDAQ:AAPL), Amazon (NASDAQ:AMZN) and Google parent Alphabet (NASDAQ:GOOGL) – ahead of their financial results for the quarter.

The FAANG group of U.S. tech stocks have been the biggest drivers of the bull market, with recent gains among most of the group far outstripping the broader market.

Facebook is expected to post earnings growth of 6.2% when it reports on Wednesday, while Apple earnings, due a day earlier, are forecast to have grown 8.7%. Amazon has warned that increased investment in its package delivery business in the last quarter will weigh on earnings, but it sees quarterly revenues up 18.7% when it reports on Thursday.

In comparison, the S&P 500’s fourth-quarter earnings are expected to decline 0.8% and revenue is seen rising 4.4%, according the latest estimates compiled by Refinitiv.

Fed meeting
The Fed will almost certainly keep monetary policy on hold on Wednesday as policymakers continue to assess how the three rate cuts from 2019 are percolating through the economy.

“With no new forecasts being released at this meeting it will be the tone of Jerome Powell’s press conference and the actual vote that is likely to be of most interest for markets,” said James Knightley, chief international economist at ING.

“We would also expect to hear Jerome Powell retaining his cautiously upbeat language, particularly given the positive conclusion to U.S.-China trade talks. He is likely to reiterate that we will need to see a “material change” for the Fed to consider a policy shift.”

Bank of England meeting
The BoE is to deliver its final monetary policy decision before Britain exits the EU on Jan 31 on Thursday and the meeting will be Mark Carney’s last as central bank governor.

The question is whether the BoE will join central bank peers in cutting interest rates. Economic growth and inflation took a hit from three-and-a-half years of Brexit uncertainty so a recent string of dismal data and comments by BoE officials, including Carney, that more economic stimulus might be needed saw rate cut expectations surge.

But economic data last week pointed to a post-election boost, leading markets to pare back expectations for a cut.

The future path of the British pound, currently trading at around $1.31, in the middle of its trading range so far in 2020 – hangs on the BoE’s decision and forecasts for whether the economy will find more momentum after Brexit.

GDP figures
The U.S. is to release advance fourth quarter GDP figures on Thursday, with analysts forecasting growth of 2.1%. U.S. President Donald Trump might repeat his argument that if it were not for Fed policy tightening, growth would be closer to 4%.

The Euro Zone is to release GDP data on Friday, which is forecast to show the economy expanded 0.2% from the previous three months, backing up the European Central Bank’s view of “ongoing, but moderate growth.”




⇑⇓ Today’s Stock Market Quotes ⇓⇑




Stock Market: This May Be The Most Important Week So Far In 2020



Stock Market — The week ahead is arguably the most important here at the start of 2020. The Federal Reserve and the Bank of England meet. The U.S. and the eurozone report initial estimates of Q4 19 GDP. The eurozone also reports its preliminary estimate of January CPI. China returns from the extended Lunar New Year celebration and reports its official PMI. Japan will report December retail sales and industrial production. These data points will provide insight into the state of the recovery from the October sales tax and typhoon.

Fears of the spread of a new virus from China and the potential economic impact weighed on risk-taking appetites last week. It is still early days, but the contagion rate appears to be tracking something close to SARS, which ended up slashing Chinese growth by two percentage points. China and Hong Kong equity markets were hit the hardest (3%+), the S&P 500’s decline of a little more than 1%, was only the fourth weekly loss but the largest since the end of Q3 ’19.

China reports the newest PMI readings on January 30. The impact of the coronavirus may not be picked up entirely in the data, which will not offer a clean read on the economy due to the Lunar New Year. To the extent that the virus impact is detected, it will likely hit services harder that manufactured goods in the first instance. That said, January manufacturing and non-manufacturing PMI are expected to have softened a little (50.2 and 53.5, respectively in December). The risk is that the economic disruption will offset the stimulus recently provided. The magnitude of the commitment to buy U.S. goods was already a stretch, according to some estimates, and weaker Chinese growth could provide another hurdle.

It has been widely reported that China committed to buying $200 bln more U.S. goods than the $128 bln purchased in 2017, the last year before the tariffs. However, last year, the U.S. exports to China were about $98 bln. So, compared with 2019, China has committed to buying $230 bln more U.S. goods. China will likely import a bit more than $2 trillion of goods and services this year. The political agreement appears to secure for the U.S. a little more than 15% of that market.

With a press conference after every FOMC meeting, and given Powell’s perceived communication challenges, it is difficult to say that the January 29 meeting is a non-event. Still, for all practical purposes, it is. There is scope for a small technical adjustment. The Fed pays 1.55% interest on both required and excess reserves. It could raise this by five basis points to ensure the fed funds rate remains within the 1.50%-1.75% target range. Many who think the Fed’s bill buying and repo operations represent an easing of monetary policy (as in QE), may argue that the Fed is tightening. However, most will likely conclude that it would be a technical adjustment and not a change in monetary policy proper.

The forecasts will not be updated until March, and the economy has not materially deviated from Fed expectations. Last year, some media reports played up the two persistent dissents against the series of rate cuts and argued Powell was losing control. However, this does not seem to be the case, and indeed a clear consensus has emerged. At the December meeting, 14 of the 17 officials thought no rate change would be needed this year.

Near-term downside risks have lessened. The U.S.-China trade deal may not deserve the embellished official descriptions, but an escalation in the coming months seems less likely than even a couple of months ago. The UK will leave the EU at the end of January for an 11-month standstill arrangement where nothing changes while a new trade deal is negotiated. The risk of a disruptive no-deal exit at the end of the year remains, but it is not yet pressing. Nevertheless, the implied yield of the December 2020 fed funds futures contract is near 1.30% compared with the current average of 1.55%, suggesting a 25 bp Fed cut has been discounted.

The Bank of England is a different story. Two members of the Monetary Policy Committee have dissented at the past couple of meetings in favor of an immediate rate cut. Two other members have indicated if the data did not improve, they too could support a rate reduction. BOE Governor Carney also sounded more dovish in recent comments. The January 30 BOE meeting will be the last Carney chairs. Andrew Baily will take the reins before the next meeting on March 26.

The official comments and the disappointing economic data has spurred a shift in market expectations. On January 10, the derivatives market implied a little less than a one-in-four chance of a rate cut on January 30. By January 17, the odds jumped to almost three-in-four. But sentiment swung back last week, and the odds narrowed to a little less than 50/50. It is a close call, and on balance, the resilience of the labor market, the recovery in business confidence, and the uptick in the PMI may keep the BOE on hold a bit longer. If this is indeed the case, sterling may pop higher, though ideas that lower rates can still be delivered later in H1 may limit the upside.

Quarterly GDP numbers often grab the headline, but for many investors, the report is a culmination of other high-frequency data with some variance. Moreover, GDP data is backward-looking. It is then more a favorite of economists than market participants. That said, the mixed signals of the U.S. economy make this GDP call particularly tricky, and the first estimate is subject to statistically significant revisions, often stemming from trade and inventories. The NY Fed’s GDP tracker (as of January 17) pointed to a sub-par 1.2% annualized pace. The Atlanta Fed’s model pointed to a 1.8% pace. The Bloomberg survey has a median forecast of 2.1%.

The composition of U.S. growth may have also changed. Consumption may have slowed from the 3.2% annualized pace in Q3. Residential investment appears to have risen, and trade also may have made a net positive contribution. The headline and core deflator are likely to be mostly steady. The Federal Reserve will look through just about any weakness in Q4 GDP and will make allowances for the production cuts at Boeing Co (NYSE:BA) in Q1 20. The case of a rate cut is based on ideas that record-long U.S. expansion is fragile and will have increasing difficulty coping with shocks. The lack of pick-up in early Q2 will leave the Fed with the same choice as last year. With price pressures subdued, another insurance policy can be taken out to boost the chances that the expansion can be extended.

Eurozone Q4 GDP seems easier to forecast. Growth has been relatively steady, with quarterly growth averaging about 0.3% for the past four quarters and 0.2% for the previous two. The year-over-year pace has been about 1.2% over the same period. It may not be very inspiring, but it is steady, and growth potential is probably only a little higher at around 1.5% or so. Market participants appear to be more confident that the ECB is on hold for the duration that it is of the Fed. The market sees only about a one-in-five chance of a rate cut by the ECB this year.

Perhaps the most challenging data point for investors to make sense of will be the initial estimate of the eurozone’s January consumer inflation. Prices fall in January. Last January, prices fell by 1%. That means that if prices fell by 0.9% this month, as economists forecast, the year-over-year rate will tick up. Indeed, the year-over-year rate is expected to rise to 1.4%. It would be the highest since last April. This is one reason why claims of Japanification of Europe are too simplistic: European inflation is nearly twice that of Japan’s. However, while we anticipate a base-effect rise in European CPI, the comparisons are not as friendly, and the true signal, as likely to be reflected in the core rate that may ease to 1.2% after being stuck at 1.3% in November and December.

Lastly, we turn to Japan. The issue at hand is how quickly it can rebound from the controversial sales tax increase and the typhoons. The most direct report will be retail sales. Recall the sequence of events. Anticipating the tax increase in October, consumers brought forward purchases, and August retail sales rose by 4.6% and then 7.2%, before plummeting 14.2% in October. They snapped back 4.5% in November and probably a little more than 1% in December.

Industrial output fell by 4.5% in October and another 1% in November. A small rise of around 0.7% is expected in December. Yet, in terms of the yen, these macro considerations seem to be of secondary importance. The heightened anxiety over the new coronavirus expressed through the sale of risk-off assets, and the unwinding of carry-trades and those speculators knowingly or unknowingly riding this wave is the primary driver now as the dollar’s advance was stalling around JPY110.25.

The coronavirus is an economic and financial shock. The extent of that shock still needs to be assessed but it could provide the spark for an arguably long-overdue adjustment in the capital markets. Investors may be risk-averse until there is greater transparency about the contagion rate and health risks. It is humbling to appreciate that despite the advances in science and medicine, some 80k Americans died in 2017-2018 from influenza, the highest toll in 40 years. The World Health Organization estimates that the annual flu epidemic kills between around 250k-500k people globally each year.



STOCK MARKET ›
NEWS ›
TODAY ›
BUSINESS ›
ECONOMIC INDICATORS ›
COMMODITIES ›
INSIGHTS ›



◊ Plus500 Review 2020 ◊


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Best Online Trading Platform For Beginners And Professional Traders. Shares, Indices, Forex and Cryptocurrencies. Start Trading Now or Try a FREE Demo Account.


Plus500 is a streamlined broker that focuses on trading in a wide range of financial markets with relatively low spreads and no commissions but without offering many extra services. Plus500 has been in the forex and CFD business since 2008. They are registered in the U.K. and licensed by the Financial Conduct Authority (FCA).

The company offers access to a comprehensive product line including forex, stock indexes, equities, commoditiescryptocurrencies, ETFs and options. Plus500 is the first broker to introduce a bitcoin CFD in 2013. The company does not charge commissions on any of its trades.

All costs are contained within the spread for each of more than 2,000 trading instruments offered on Plus500’s WebTrader platformPlus500 Ltd. (PLUS.L) is a publicly traded company on the AIM section of the London Stock Exchange since 2013 with a £1.73 billion ($2.25 billion) market capitalization and clients in more than 50 countries around the world. Plus500 offers access to more than 2,000 trading instruments.


START TRADING NOW OR TRY A FREE DEMO ACCOUNT


Trust … the company is registered with the Financial Conduct Authority (FCA), CySEC, ASIC, FSCA, FMA, MAS, and the ISA, which provides good accountability and visibility. The company is required to take steps to ensure client funds are not comingled with corporate funds – ensuring that client money and assets are protected in the unlikely event that Plus500 becomes insolvent – by holding those funds in segregated accounts at regulated banks.

If Plus500 defaults, any shortfall of funds of up to £50,000 may be compensated for under the Financial Services Compensation Scheme (FSCS). If the custodian bank holding client funds goes into liquidation, any shortfall of funds of up to £85,000 may be compensated for under the FSCS.

Plus500 also offers Negative Balance Protection, ensuring that clients cannot lose more than they have put into their account. Guaranteed stop losses can be used on some instruments depending on market conditions but they are subject to a wider spread.

The company does not charge commissions on any of its trades. All costs are contained within the spread for each of more than 2,000 trading instruments offered on Plus500’s WebTrader platform. Large volume traders do not get a trading discount at Plus500 and the spread is the same whether you trade one lot or 1,000 lots.


+


There are no charges for normal withdrawals or terminating an account. However, inactivity fees kick in after an account has been idle for three months. Beginning traders can open an account with as little as £100.

Traders can qualify for a “professional” account, which offers a higher level of maximum leverage, but the costs are the same. Investors with a professional account may increase their maximum leverage ten-fold, from 1:30 to 1:300.Spreads at Plus500 were some of the lowest in the market.

Plus500 also offers access to options trading on many markets. These are very similar to plain call and put options traded on exchanges, but they are not standardized which means that the option premium can be customized for your risk tolerance and strategy objectives.


START TRADING NOW OR TRY A FREE DEMO ACCOUNT


 

Stock Market: Economic Calendar – Top 5 Things to Watch This Week

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Stock Market — Here’s what you need to know to start your week.


Coronavirus outbreak
Market participants are keeping a wary eye on developments surrounding the coronavirus outbreak which has infected more than 2,000 people, the vast majority in China where 56 people have died. The virus has also spread to the U.S., Thailand, South Korea, Japan, Australia, France and Canada.

With stocks close to all-time highs investors are fearful that the newly identified virus could develop into something worse, like the 2003 SARS epidemic.

“Markets hate uncertainty and the virus has been enough to inject uncertainty in the markets,” said David Carter, chief investment officer at Lenox Wealth Advisors in New York.

The World Health Organization has stopped short of calling the outbreak a global health emergency, but some health experts question whether China can continue to contain the epidemic.

More FAANG results
While last week’s Q4 earnings from Netflix (NASDAQ:NFLX) underwhelmed Wall Street, analyst hopes are still high for the other FAANGs – Facebook (NASDAQ:FB), Apple (NASDAQ:AAPL), Amazon (NASDAQ:AMZN) and Google parent Alphabet (NASDAQ:GOOGL) – ahead of their financial results for the quarter.

The FAANG group of U.S. tech stocks have been the biggest drivers of the bull market, with recent gains among most of the group far outstripping the broader market.

Facebook is expected to post earnings growth of 6.2% when it reports on Wednesday, while Apple earnings, due a day earlier, are forecast to have grown 8.7%. Amazon has warned that increased investment in its package delivery business in the last quarter will weigh on earnings, but it sees quarterly revenues up 18.7% when it reports on Thursday.

In comparison, the S&P 500’s fourth-quarter earnings are expected to decline 0.8% and revenue is seen rising 4.4%, according the latest estimates compiled by Refinitiv.

Fed meeting
The Fed will almost certainly keep monetary policy on hold on Wednesday as policymakers continue to assess how the three rate cuts from 2019 are percolating through the economy.

“With no new forecasts being released at this meeting it will be the tone of Jerome Powell’s press conference and the actual vote that is likely to be of most interest for markets,” said James Knightley, chief international economist at ING.

“We would also expect to hear Jerome Powell retaining his cautiously upbeat language, particularly given the positive conclusion to U.S.-China trade talks. He is likely to reiterate that we will need to see a “material change” for the Fed to consider a policy shift.”

Bank of England meeting
The BoE is to deliver its final monetary policy decision before Britain exits the EU on Jan 31 on Thursday and the meeting will be Mark Carney’s last as central bank governor.

The question is whether the BoE will join central bank peers in cutting interest rates. Economic growth and inflation took a hit from three-and-a-half years of Brexit uncertainty so a recent string of dismal data and comments by BoE officials, including Carney, that more economic stimulus might be needed saw rate cut expectations surge.

But economic data last week pointed to a post-election boost, leading markets to pare back expectations for a cut.

The future path of the British pound, currently trading at around $1.31, in the middle of its trading range so far in 2020 – hangs on the BoE’s decision and forecasts for whether the economy will find more momentum after Brexit.

GDP figures
The U.S. is to release advance fourth quarter GDP figures on Thursday, with analysts forecasting growth of 2.1%. U.S. President Donald Trump might repeat his argument that if it were not for Fed policy tightening, growth would be closer to 4%.

The Euro Zone is to release GDP data on Friday, which is forecast to show the economy expanded 0.2% from the previous three months, backing up the European Central Bank’s view of “ongoing, but moderate growth.”




⇑⇓ Today’s Stock Market Quotes ⇓⇑




Stock Market: This May Be The Most Important Week So Far In 2020



Stock Market — The week ahead is arguably the most important here at the start of 2020. The Federal Reserve and the Bank of England meet. The U.S. and the eurozone report initial estimates of Q4 19 GDP. The eurozone also reports its preliminary estimate of January CPI. China returns from the extended Lunar New Year celebration and reports its official PMI. Japan will report December retail sales and industrial production. These data points will provide insight into the state of the recovery from the October sales tax and typhoon.

Fears of the spread of a new virus from China and the potential economic impact weighed on risk-taking appetites last week. It is still early days, but the contagion rate appears to be tracking something close to SARS, which ended up slashing Chinese growth by two percentage points. China and Hong Kong equity markets were hit the hardest (3%+), the S&P 500’s decline of a little more than 1%, was only the fourth weekly loss but the largest since the end of Q3 ’19.

China reports the newest PMI readings on January 30. The impact of the coronavirus may not be picked up entirely in the data, which will not offer a clean read on the economy due to the Lunar New Year. To the extent that the virus impact is detected, it will likely hit services harder that manufactured goods in the first instance. That said, January manufacturing and non-manufacturing PMI are expected to have softened a little (50.2 and 53.5, respectively in December). The risk is that the economic disruption will offset the stimulus recently provided. The magnitude of the commitment to buy U.S. goods was already a stretch, according to some estimates, and weaker Chinese growth could provide another hurdle.

It has been widely reported that China committed to buying $200 bln more U.S. goods than the $128 bln purchased in 2017, the last year before the tariffs. However, last year, the U.S. exports to China were about $98 bln. So, compared with 2019, China has committed to buying $230 bln more U.S. goods. China will likely import a bit more than $2 trillion of goods and services this year. The political agreement appears to secure for the U.S. a little more than 15% of that market.

With a press conference after every FOMC meeting, and given Powell’s perceived communication challenges, it is difficult to say that the January 29 meeting is a non-event. Still, for all practical purposes, it is. There is scope for a small technical adjustment. The Fed pays 1.55% interest on both required and excess reserves. It could raise this by five basis points to ensure the fed funds rate remains within the 1.50%-1.75% target range. Many who think the Fed’s bill buying and repo operations represent an easing of monetary policy (as in QE), may argue that the Fed is tightening. However, most will likely conclude that it would be a technical adjustment and not a change in monetary policy proper.

The forecasts will not be updated until March, and the economy has not materially deviated from Fed expectations. Last year, some media reports played up the two persistent dissents against the series of rate cuts and argued Powell was losing control. However, this does not seem to be the case, and indeed a clear consensus has emerged. At the December meeting, 14 of the 17 officials thought no rate change would be needed this year.

Near-term downside risks have lessened. The U.S.-China trade deal may not deserve the embellished official descriptions, but an escalation in the coming months seems less likely than even a couple of months ago. The UK will leave the EU at the end of January for an 11-month standstill arrangement where nothing changes while a new trade deal is negotiated. The risk of a disruptive no-deal exit at the end of the year remains, but it is not yet pressing. Nevertheless, the implied yield of the December 2020 fed funds futures contract is near 1.30% compared with the current average of 1.55%, suggesting a 25 bp Fed cut has been discounted.

The Bank of England is a different story. Two members of the Monetary Policy Committee have dissented at the past couple of meetings in favor of an immediate rate cut. Two other members have indicated if the data did not improve, they too could support a rate reduction. BOE Governor Carney also sounded more dovish in recent comments. The January 30 BOE meeting will be the last Carney chairs. Andrew Baily will take the reins before the next meeting on March 26.

The official comments and the disappointing economic data has spurred a shift in market expectations. On January 10, the derivatives market implied a little less than a one-in-four chance of a rate cut on January 30. By January 17, the odds jumped to almost three-in-four. But sentiment swung back last week, and the odds narrowed to a little less than 50/50. It is a close call, and on balance, the resilience of the labor market, the recovery in business confidence, and the uptick in the PMI may keep the BOE on hold a bit longer. If this is indeed the case, sterling may pop higher, though ideas that lower rates can still be delivered later in H1 may limit the upside.

Quarterly GDP numbers often grab the headline, but for many investors, the report is a culmination of other high-frequency data with some variance. Moreover, GDP data is backward-looking. It is then more a favorite of economists than market participants. That said, the mixed signals of the U.S. economy make this GDP call particularly tricky, and the first estimate is subject to statistically significant revisions, often stemming from trade and inventories. The NY Fed’s GDP tracker (as of January 17) pointed to a sub-par 1.2% annualized pace. The Atlanta Fed’s model pointed to a 1.8% pace. The Bloomberg survey has a median forecast of 2.1%.

The composition of U.S. growth may have also changed. Consumption may have slowed from the 3.2% annualized pace in Q3. Residential investment appears to have risen, and trade also may have made a net positive contribution. The headline and core deflator are likely to be mostly steady. The Federal Reserve will look through just about any weakness in Q4 GDP and will make allowances for the production cuts at Boeing Co (NYSE:BA) in Q1 20. The case of a rate cut is based on ideas that record-long U.S. expansion is fragile and will have increasing difficulty coping with shocks. The lack of pick-up in early Q2 will leave the Fed with the same choice as last year. With price pressures subdued, another insurance policy can be taken out to boost the chances that the expansion can be extended.

Eurozone Q4 GDP seems easier to forecast. Growth has been relatively steady, with quarterly growth averaging about 0.3% for the past four quarters and 0.2% for the previous two. The year-over-year pace has been about 1.2% over the same period. It may not be very inspiring, but it is steady, and growth potential is probably only a little higher at around 1.5% or so. Market participants appear to be more confident that the ECB is on hold for the duration that it is of the Fed. The market sees only about a one-in-five chance of a rate cut by the ECB this year.

Perhaps the most challenging data point for investors to make sense of will be the initial estimate of the eurozone’s January consumer inflation. Prices fall in January. Last January, prices fell by 1%. That means that if prices fell by 0.9% this month, as economists forecast, the year-over-year rate will tick up. Indeed, the year-over-year rate is expected to rise to 1.4%. It would be the highest since last April. This is one reason why claims of Japanification of Europe are too simplistic: European inflation is nearly twice that of Japan’s. However, while we anticipate a base-effect rise in European CPI, the comparisons are not as friendly, and the true signal, as likely to be reflected in the core rate that may ease to 1.2% after being stuck at 1.3% in November and December.

Lastly, we turn to Japan. The issue at hand is how quickly it can rebound from the controversial sales tax increase and the typhoons. The most direct report will be retail sales. Recall the sequence of events. Anticipating the tax increase in October, consumers brought forward purchases, and August retail sales rose by 4.6% and then 7.2%, before plummeting 14.2% in October. They snapped back 4.5% in November and probably a little more than 1% in December.

Industrial output fell by 4.5% in October and another 1% in November. A small rise of around 0.7% is expected in December. Yet, in terms of the yen, these macro considerations seem to be of secondary importance. The heightened anxiety over the new coronavirus expressed through the sale of risk-off assets, and the unwinding of carry-trades and those speculators knowingly or unknowingly riding this wave is the primary driver now as the dollar’s advance was stalling around JPY110.25.

The coronavirus is an economic and financial shock. The extent of that shock still needs to be assessed but it could provide the spark for an arguably long-overdue adjustment in the capital markets. Investors may be risk-averse until there is greater transparency about the contagion rate and health risks. It is humbling to appreciate that despite the advances in science and medicine, some 80k Americans died in 2017-2018 from influenza, the highest toll in 40 years. The World Health Organization estimates that the annual flu epidemic kills between around 250k-500k people globally each year.



STOCK MARKET ›
NEWS ›
TODAY ›
BUSINESS ›
ECONOMIC INDICATORS ›
COMMODITIES ›
INSIGHTS ›



◊ Plus500 Review 2020 ◊


plus-500-banner-01


Best Online Trading Platform For Beginners And Professional Traders. Shares, Indices, Forex and Cryptocurrencies. Start Trading Now or Try a FREE Demo Account.


Plus500 is a streamlined broker that focuses on trading in a wide range of financial markets with relatively low spreads and no commissions but without offering many extra services. Plus500 has been in the forex and CFD business since 2008. They are registered in the U.K. and licensed by the Financial Conduct Authority (FCA).

The company offers access to a comprehensive product line including forex, stock indexes, equities, commoditiescryptocurrencies, ETFs and options. Plus500 is the first broker to introduce a bitcoin CFD in 2013. The company does not charge commissions on any of its trades.

All costs are contained within the spread for each of more than 2,000 trading instruments offered on Plus500’s WebTrader platformPlus500 Ltd. (PLUS.L) is a publicly traded company on the AIM section of the London Stock Exchange since 2013 with a £1.73 billion ($2.25 billion) market capitalization and clients in more than 50 countries around the world. Plus500 offers access to more than 2,000 trading instruments.


START TRADING NOW OR TRY A FREE DEMO ACCOUNT


Trust … the company is registered with the Financial Conduct Authority (FCA), CySEC, ASIC, FSCA, FMA, MAS, and the ISA, which provides good accountability and visibility. The company is required to take steps to ensure client funds are not comingled with corporate funds – ensuring that client money and assets are protected in the unlikely event that Plus500 becomes insolvent – by holding those funds in segregated accounts at regulated banks.

If Plus500 defaults, any shortfall of funds of up to £50,000 may be compensated for under the Financial Services Compensation Scheme (FSCS). If the custodian bank holding client funds goes into liquidation, any shortfall of funds of up to £85,000 may be compensated for under the FSCS.

Plus500 also offers Negative Balance Protection, ensuring that clients cannot lose more than they have put into their account. Guaranteed stop losses can be used on some instruments depending on market conditions but they are subject to a wider spread.

The company does not charge commissions on any of its trades. All costs are contained within the spread for each of more than 2,000 trading instruments offered on Plus500’s WebTrader platform. Large volume traders do not get a trading discount at Plus500 and the spread is the same whether you trade one lot or 1,000 lots.


+


There are no charges for normal withdrawals or terminating an account. However, inactivity fees kick in after an account has been idle for three months. Beginning traders can open an account with as little as £100.

Traders can qualify for a “professional” account, which offers a higher level of maximum leverage, but the costs are the same. Investors with a professional account may increase their maximum leverage ten-fold, from 1:30 to 1:300.Spreads at Plus500 were some of the lowest in the market.

Plus500 also offers access to options trading on many markets. These are very similar to plain call and put options traded on exchanges, but they are not standardized which means that the option premium can be customized for your risk tolerance and strategy objectives.


START TRADING NOW OR TRY A FREE DEMO ACCOUNT


Trading News: 3 Things Under the Radar This Week


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Trading News — There’s an ominous technical indicator hovering over the U.S. dollar, which could mean a move away from the greenback. But don’t go looking for value in bitcoin, according to one fund manager speaking at the World Economic Forum in Davos, Switzerland this week. Meanwhile, as lower interest rates have been a boon to equities, the run of ever-cheaper money may finally be coming to an end, according to one investment bank.



Here are three things that flew under the radar this week.

1. Dollar Hits the Death Cross

While markets were captivated this week on fundamentals, with some calling the Wuhan coronavirus a possible Black Swan, technicals weren’t overlooked.

The U.S. dollar could be in the crosshairs of the infamous death cross. The death cross happens when a 50-day moving average goes below the 200-day moving average, which happened on the last day of 2019, according to Bank of America Merrill Lynch.

When that’s been triggered in the past, the dollar has gone down seven out of eight times since 1980, Merrill said.

Adding to concerns is the fundamental backdrop of a global economy that may not need the safety of the greenback as much as it used to.

“The global economy looks like it’s healing,” TD Securities Mark McCormick said. “The reduction of uncertainty will likely allow investors to take risks … they didn’t want to take before.”

Momtchil Pojarliev, head of currencies at BNP Asset Management, is betting the dollar will fall against the euro, Japanese yen and Australian dollar as growth in those countries accelerates and their central banks raise interest rates while the Federal Reserve keeps them steady. That should narrow the gap in yields that has buoyed the U.S. currency.

2. Ray Dalio Debunks Bitcoin’s Diversification Powers

Bitcoin has been hailed in some corners as the holy grail of uncorrelated diversification assets, but famed fund manager Raymond Dalio warned earlier this week that bitcoin has no place in the real of world of investing.

With interest rates looking lower for longer and rendering cash almost useless, Dalio pushed back at the World Economic Forum in Davos, Switzerland against claims that bitcoin has a place in a diversified portfolio, pointing to the popular cryptocurrency’s lack of intrinsic value and wild swings.

“There’re two purposes of money: a medium of exchange and a store hold of wealth,” he said. “And Bitcoin is not effective in either of those cases now … It’s too volatile. Because of the volatility, you can’t go next to it.”

While there would be many who share Dalio’s view that bitcoin currently lacks the credentials to be taken seriously as a form payment, some of the most important central bankers have conceded that bitcoin has a role to play in a diversified portfolio.

“Really almost no one uses bitcoin for payments, they use it as an alternative to gold. It’s a store of value, a speculative store of value, like gold,” Federal Reserve Chairman Jerome Powell said in the summer of last year.

“Bitcoin’s consistent statistically uncorrelated nature provides an excellent source of diversification within a portfolio,” Blockhead Capital said, citing its study that measured the correlation of bitcoin’s price performance to several other assets or indices.

3. Easing Is Ending?

The main case for central banks cutting rates is receding, making the case for more accommodative monetary policy from current levels harder to justify, according to J.P. Morgan. The argument for an economic mid-year rebound has strengthened, J.P. Morgan said in a note to clients this week.

“The easing cycle is … close to an end and central bankers can take comfort that their limited and unconventional toolbox proved effective in cushioning a substantial shock,” analyst Bruce Kasman and team said.

But the biggest challenge that major central banks will face is dealing with inflation.

“With the Fed having lost confidence in translating current growth and labor market outcomes to future inflation, core inflation will likely need to move above 2% before it considers reversing last year’s ease,” J.P. Morgan said. “In refraining from reversing last year’s mid-cycle adjustment until inflation rises, the Fed will break from its past pattern of removing insurance once it became convinced that the growth scare had passed.”

Unlike the Fed, which looks happy to overshoot on inflation, the Bank of Japan will likely be content to undershoot.

Meanwhile, the “(p)ersistently low inflation remains a prime concern” for the ECB, but “creeping financial stability concerns set the bar high for additional action.”





Best Online Trading Platform {2020}. Shares, Indices, Forex and Cryptocurrencies. Start Trading Now or Try a FREE Demo Account.





Stock Market News: U.S. Stocks Fall After Second Coronavirus Case Emerges

Stock Market News — The S&P 500 erased early gains and fell 0.6 per cent around lunchtime in New York. The Nasdaq Composite, which had registered an intraday record high in morning trade, was down 0.5 per cent even as upbeat earnings from Intel — which surged to its highest level since September 2000 — lifted chipmakers. The Dow also lost 0.5 per cent.

The declines followed a rise in European stocks as investors appeared to brush off concerns over the market impact of coronavirus, while there were fresh signs of life in the German economy.

The Stoxx Europe 600 rose 0.9 per cent, down from session highs but snapping four days of losses as major bourses from London to Frankfurt climbed higher. The euro dipped, falling 0.2 per cent against the dollar, after survey data showed business activity in the eurozone remained unexpectedly weak in January.

Still, activity in Germany, the eurozone’s largest economy, beat expectations. That pushed the Dax 1.4 per cent higher for its best day in more than three months.

Investors had few cues from the Asian session, where Chinese markets were closed for the lunar new year holiday. Hong Kong’s Hang Seng rose 0.2 per cent in its half-day of trading, but has still lost nearly 4 per cent this week as concerns over the outbreak of virus have weighed on investor sentiment.

The World Health Organization on Thursday held back from declaring a global emergency over the outbreak, but said its panel was split “almost 50:50”.

Paul Donovan, a strategist at UBS, said structural changes to the nature of the global economy make it hard to draw a clear analysis from events so far.

“There may be a further shift to online retail sales, limiting the damage to the consumer,” he said. But, he added “the rise of fake news on social media may spread fear faster and wider.”

The outbreak has prompted S&P Global Ratings, the credit rating agency, to warn that if the situation worsened considerably the disease could knock 1.2 percentage points off China’s economic growth this year.

Sterling fell 0.4 per cent after upbeat UK PMI data failed to convince investors that the Bank of England will hold off cutting interest rates next week. The meeting is now on a knife-edge, with traders pricing in a 48 per cent chance of a rate cut to 0.5 per cent, prices in swaps markets show.

In the US, a majority of investors are betting the Federal Reserve will maintain its pause on interest rates after three cuts last year.




Stock Market: World Economy Going Through Longest Period of Falling Trade Since 2009

Stock Market — The downturn in global trade dragged on at the end of last year, marking the longest period of contraction since the end of the financial crisis.The volume of goods trade dropped 0.6 per cent in November compared to the previous month, and was down 1.1 per cent compared to the same month in 2018, according to a closely watched world trade monitor from the Netherlands Bureau for Economic Policy Analysis (CPB).

November marked the sixth consecutive month of year-on-year contraction, the longest period of falling trade since 2009 and a sharp reversal from the 3.4 per cent expansion in November 2018.

The rate of contraction slowed in November, however, down from a 2 per cent pace in October, which was the steepest fall in a decade.

The annual contraction in trade- which is the value of exports and imports adjusted for price changes — was geographically broad-based with the eurozone, emerging Asia, the US and Latin America all reporting falling trade volumes.

However, trade was up over the previous month in emerging Asia, while the downturn became more severe in the eurozone where trade volumes dropped 1.7 per cent compared to October.

The data confirm surveys released earlier this month that showed a deterioration in global trade running until the end of the year. The exports order component of the JPMorgan Global purchasing manager index remained in negative territory in November and December, although up from September’s reading.

“International trade remains the main drag on efforts to lift growth further, so any moves that reduce tensions and barriers on this front will be especially beneficial.” Olya Borichevska, from Global Economic Research at JPMorgan.

Economists expect trade data to improve in early 2020, reflecting the signing of the US-China phase one trade deal earlier this month, as well as improving conditions in emerging economies such as Turkey. But a strong recovery is not on the cards yet.

“We think a recovery in world trade will be very modest, despite the pause in US-China hostilities” said Adam Slater, chief economist at Oxford Economics.

“World trade growth at this pace is less than half its long-term average.”







Plus500 CFD Review { 2020 }


Plus500 Rewiew 2020 — Plus500 is an international financial firm providing online trading services in contracts for difference (CFDs), across more than 2,000 securities and multiple asset classes. The company is headquartered in Israel and has subsidiaries in UK, Cyprus, Australia, Singapore and Bulgaria.

Plus500 is authorised and regulated by the Financial Conduct Authority (FCA), the Cyprus Securities and Exchange Commission (CySEC), the Australian Securities and Investments Commission (ASIC), the Monetary Authority of Singapore (MAS), and the Israel Securities Authority (ISA). It is listed on the London Stock Exchange with the ticker “PLUS” and is a constituent of the FTSE 250 Index.


plus-500-banner-01


• Business & Financial News – Stock Market News Today •


Best Online Trading Platform For Beginners And Professional Traders. Shares, Indices, Forex and Cryptocurrencies. Start Trading Now or Try a FREE Demo Account.


Plus500 is a streamlined broker that focuses on trading in a wide range of financial markets with relatively low spreads and no commissions but without offering many extra services. Plus500 has been in the forex and CFD business since 2008. They are registered in the U.K. and licensed by the Financial Conduct Authority (FCA).

The company offers access to a comprehensive product line including forex, stock indexes, equities, commoditiescryptocurrencies, ETFs and options. Plus500 is the first broker to introduce a bitcoin CFD in 2013. The company does not charge commissions on any of its trades.

All costs are contained within the spread for each of more than 2,000 trading instruments offered on Plus500’s WebTrader platformPlus500 Ltd. (PLUS.L) is a publicly traded company on the AIM section of the London Stock Exchange since 2013 with a £1.73 billion ($2.25 billion) market capitalization and clients in more than 50 countries around the world. Plus500 offers access to more than 2,000 trading instruments.


START TRADING NOW OR TRY A FREE DEMO ACCOUNT


Trust … the company is registered with the Financial Conduct Authority (FCA), CySEC, ASIC, FSCA, FMA, MAS, and the ISA, which provides good accountability and visibility. The company is required to take steps to ensure client funds are not comingled with corporate funds – ensuring that client money and assets are protected in the unlikely event that Plus500 becomes insolvent – by holding those funds in segregated accounts at regulated banks.

If Plus500 defaults, any shortfall of funds of up to £50,000 may be compensated for under the Financial Services Compensation Scheme (FSCS). If the custodian bank holding client funds goes into liquidation, any shortfall of funds of up to £85,000 may be compensated for under the FSCS.


best-broker-stock-market


Plus500 also offers Negative Balance Protection, ensuring that clients cannot lose more than they have put into their account. Guaranteed stop losses can be used on some instruments depending on market conditions but they are subject to a wider spread.

The company does not charge commissions on any of its trades. All costs are contained within the spread for each of more than 2,000 trading instruments offered on Plus500’s WebTrader platform. Large volume traders do not get a trading discount at Plus500 and the spread is the same whether you trade one lot or 1,000 lots.


+


There are no charges for normal withdrawals or terminating an account. However, inactivity fees kick in after an account has been idle for three months. Beginning traders can open an account with as little as £100.

Traders can qualify for a “professional” account, which offers a higher level of maximum leverage, but the costs are the same. Investors with a professional account may increase their maximum leverage ten-fold, from 1:30 to 1:300.Spreads at Plus500 were some of the lowest in the market.

Plus500 also offers access to options trading on many markets. These are very similar to plain call and put options traded on exchanges, but they are not standardized which means that the option premium can be customized for your risk tolerance and strategy objectives.


START TRADING NOW OR TRY A FREE DEMO ACCOUNT


Plus500 Deposits and Withdrawals

Plus500 Deposits and Withdrawals… This Answers the Following Questions: What is the minimum deposit for Plus500? What payment methods are accepted by Plus500? Does Plus500 accept PayPal? How to withdraw money from Plus500? How much can you withdraw from Plus500?… Read More ›

Best Stock Trading Platform In Europe {2020}

⇑⇓ Best Trading Platform Europe ⇓⇑ StockMarketNews.Today — what is the best stock trading platform in Europe for 2020? ….  How To Choose The Best Online Broker in Europe { 2020 } … Best Online Trading Platform. Start Trading Now or Try… Read More

> START TRADING NOW OR TRY A FREE DEMO ACCOUNT <

Stock Market: World Economy Going Through Longest Period of Falling Trade Since 2009

Stock Market — The downturn in global trade dragged on at the end of last year, marking the longest period of contraction since the end of the financial crisis.

The volume of goods trade dropped 0.6 per cent in November compared to the previous month, and was down 1.1 per cent compared to the same month in 2018, according to a closely watched world trade monitor from the Netherlands Bureau for Economic Policy Analysis (CPB).

November marked the sixth consecutive month of year-on-year contraction, the longest period of falling trade since 2009 and a sharp reversal from the 3.4 per cent expansion in November 2018.

The rate of contraction slowed in November, however, down from a 2 per cent pace in October, which was the steepest fall in a decade.

The annual contraction in trade- which is the value of exports and imports adjusted for price changes — was geographically broad-based with the eurozone, emerging Asia, the US and Latin America all reporting falling trade volumes.

However, trade was up over the previous month in emerging Asia, while the downturn became more severe in the eurozone where trade volumes dropped 1.7 per cent compared to October.

The data confirm surveys released earlier this month that showed a deterioration in global trade running until the end of the year. The exports order component of the JPMorgan Global purchasing manager index remained in negative territory in November and December, although up from September’s reading.

“International trade remains the main drag on efforts to lift growth further, so any moves that reduce tensions and barriers on this front will be especially beneficial.” Olya Borichevska, from Global Economic Research at JPMorgan.

Economists expect trade data to improve in early 2020, reflecting the signing of the US-China phase one trade deal earlier this month, as well as improving conditions in emerging economies such as Turkey. But a strong recovery is not on the cards yet.

“We think a recovery in world trade will be very modest, despite the pause in US-China hostilities” said Adam Slater, chief economist at Oxford Economics.

“World trade growth at this pace is less than half its long-term average.”







How To Make Money Online{ 2020 }


Internet offers many opportunities to make a lot of money. Whether you’re looking to make some fast cash, or you’re after long-term, more sustainable income-producing results, there are certainly ways you can make money online today. The truth is that making money online isn’t as difficsult as most make it out to seem.





However, if you’re looking for realistic ways to make money now, then it really truly does boil down to 11 paths you can take towards profit. Some will provide you with immediate results, helping you to address your basic monthly necessities, while others have the potential to transform your life by revolutionizing your finances in the long term…



• Personal Loans Online Fast Approval •



  • 1. Make Money as a Life Coach

LIFE

Money Invested: $45 | Time Invested: 110 Hours | Money Earned (30 days): $879

How To Make Money as Life Coach: Life coaching is the process of helping people identify and achieve personal goals through developing skills and attitudes that lead to self-empowerment. Life coaching general deals with issues such as work-life balance and career changes, and often occurs outside the workplace setting. Learn More …



Affiliate

Money Invested: $1,300 | Time Invested: 72 Hours | Money Earned (30 days): $7,742

How To Make Money In Affiliate Marketing: Affiliate marketing is the process of earning a commission by promoting other people’s (or company’s) products. You find a product you like, promote it to others and earn a piece of the profit for each sale that you make. Learn More …



  • 3. Make Extra Money Online Simply By Sharing Your Opinions

opinion

Money Invested: $1 | Time Invested: 46 Hours | Money Earned (30 days): $329

How To Make Money by Sharing Your Opinion: A Review ( Opinion ) is an evaluation of a publication, service, or company such as a movie, video game, musical composition, book; a piece of hardware like a car, home appliance, or computer; or an event or performance, such as a live music concert, play, musical theater show, dance show, or art exhibition. Learn More …



  • 4. Make Money With an Online Drop Shipping Business

drop

Money Invested: $75 | Time Invested: 144 Hours | Money Earned (30 days): $1,915

How To Make Money With an Online Drop Shipping Business: Drop shipping is a business model where you send your customers’ orders to a manufacturer or wholesaler, and they send the products directly to your customer. Learn More …



  • 5. Write an Ebook and sell it on Amazon

write-publish-ebook-today

Money Invested: $55 | Time Invested: 108 Hours | Money Earned (30 days): $973

How to Make Money Selling Ebooks Online: Do you want to learn how to make an ebook from beginning to end?… Writing ebooks is one of the easiest way to earn money. You work on your own time, and when you finish the book – you will make money from it over and over again…for a very long time!. Learn More …



  • 6. Make Money on Twitter

Twitt22

Money Invested: $25 | Time Invested: 52 Hours | Money Earned (30 days): $494

How to Make Money on Twitter: Twitter is an American online microblogging and social networking service on which users post and interact with messages known as “tweets”. Selling advertising, sponsored links, and affiliate marketing. Here are a few programs that can help you make money on Twitter. Learn More …



become-domain-reseller

Money Invested: $55 | Time Invested: 110 Hours | Money Earned (30 days): $1,514

How To Make Money Selling Domain Names: Domain name is like a land on the Web. You can use domains in a variety of ways to make money. Domains increase value over time, especially if they have some commercial value. You can buy a domain name at low price and then sell it high priceLearn More …



best-broker-stock-market

Money Invested: $300 | Time Invested: 72 Hours | Money Earned (30 days): $3,177

How To Make Money in Stock Trading: Investing in the stock market can be a great way to have your money make money… Stock trading is not a risk-free activity, and some losses are inevitable. However, with substantial research and investments in the right companies, stock trading can potentially be very profitable. Learn More …


  • 9. Make Money With Your Photos

makemoneyphotos

Money Invested: $1 | Time Invested: 74 Hours | Money Earned (30 days): $374

How To Earn Money Selling Photos Online: Who wouldn’t want to earn money by selling their photos online? … Did you know thousands of photographers are making hundreds even thousands of dollars every day just by selling their photos online?… In fact every month millions of photos are bought online which is used for websites, magazines, blogs, print ads, marketing materials and many more. Learn More …



superstockdisney

Money Invested: $1 | Time Invested: 60 Hours | Money Earned (30 days): $245

How To Make Money on Youtube: You’ve probably heard stories about regular people earning money on YouTube and thought, “Hey, I can do this too!”. Earning with YouTube is easy, but making big money with the platform can be a challenge. Learn More …



  • 11. Make Money Testing Apps

55Apps

Money Invested: $20 | Time Invested: 44 Hours | Money Earned (30 days): $197

How To Make Money Testing Apps: Testing Apps is a great way to earn extra money but it won’t make you rich. The number of opportunities you receive will depend on a number of factors, such as your demographics and your quality rating. Learn More …







◊ Plus500 Review 2020 ◊


plus-500-banner-01


Best Online Trading Platform For Beginners And Professional Traders. Shares, Indices, Forex and Cryptocurrencies. Start Trading Now or Try a FREE Demo Account.


Plus500 is a streamlined broker that focuses on trading in a wide range of financial markets with relatively low spreads and no commissions but without offering many extra services. Plus500 has been in the forex and CFD business since 2008. They are registered in the U.K. and licensed by the Financial Conduct Authority (FCA).

The company offers access to a comprehensive product line including forex, stock indexes, equities, commoditiescryptocurrencies, ETFs and options. Plus500 is the first broker to introduce a bitcoin CFD in 2013. The company does not charge commissions on any of its trades.

All costs are contained within the spread for each of more than 2,000 trading instruments offered on Plus500’s WebTrader platformPlus500 Ltd. (PLUS.L) is a publicly traded company on the AIM section of the London Stock Exchange since 2013 with a £1.73 billion ($2.25 billion) market capitalization and clients in more than 50 countries around the world. Plus500 offers access to more than 2,000 trading instruments.


START TRADING NOW OR TRY A FREE DEMO ACCOUNT


Trust … the company is registered with the Financial Conduct Authority (FCA), CySEC, ASIC, FSCA, FMA, MAS, and the ISA, which provides good accountability and visibility. The company is required to take steps to ensure client funds are not comingled with corporate funds – ensuring that client money and assets are protected in the unlikely event that Plus500 becomes insolvent – by holding those funds in segregated accounts at regulated banks.

If Plus500 defaults, any shortfall of funds of up to £50,000 may be compensated for under the Financial Services Compensation Scheme (FSCS). If the custodian bank holding client funds goes into liquidation, any shortfall of funds of up to £85,000 may be compensated for under the FSCS.


best-broker-stock-market


Plus500 also offers Negative Balance Protection, ensuring that clients cannot lose more than they have put into their account. Guaranteed stop losses can be used on some instruments depending on market conditions but they are subject to a wider spread.

The company does not charge commissions on any of its trades. All costs are contained within the spread for each of more than 2,000 trading instruments offered on Plus500’s WebTrader platform. Large volume traders do not get a trading discount at Plus500 and the spread is the same whether you trade one lot or 1,000 lots.

There are no charges for normal withdrawals or terminating an account. However, inactivity fees kick in after an account has been idle for three months. Beginning traders can open an account with as little as £100.

Traders can qualify for a “professional” account, which offers a higher level of maximum leverage, but the costs are the same. Investors with a professional account may increase their maximum leverage ten-fold, from 1:30 to 1:300.Spreads at Plus500 were some of the lowest in the market.

Plus500 also offers access to options trading on many markets. These are very similar to plain call and put options traded on exchanges, but they are not standardized which means that the option premium can be customized for your risk tolerance and strategy objectives.


START TRADING NOW OR TRY A FREE DEMO ACCOUNT


 

Stock Market Today: Markets rebound, Investors Reassured by Beijing’s Response to the Coronavirus

Stock Market News Today — US stocks hit records, with the S&P 500, Nasdaq Composite and Dow Jones Industrial Average each hitting all-time intraday highs soon after the open.

Asian markets rebounded from the previous session’s sell-off. Hong Kong’s Hang Seng index rose 1.3 per cent, recovering some of Tuesday’s losses, while shares in mainland China rebounded off year-lows to close higher. European markets nudged higher.

“The spread of a new coronavirus across Asia and into the US is clearly a major public health concern, but we suspect that its economic effects will be modest,” said Jennifer McKeown, head of global economics at Capital Economics.

The coronavirus has killed nine people and infected at least 440 in China, and has since spread to other Asian countries and North America. Controlling the outbreak has now reached a critical stage as more than 100m Chinese prepare to board trains and aeroplanes to return home for the Lunar New Year.

The outbreak has evoked memories of China’s Sars crisis in 2003, but markets have been reassured by a higher degree of urgency and transparency in controlling the disease.

“The speed with which this virus has been identified is testament to changes in public health in China since Sars and strong global co-ordination through the World Health Organisation,” Jeremy Farrar, director of health research foundation Wellcome, said.

In 2003, the Sars outbreak sent Hong Kong into recession and the Hang Seng index fell nearly 7.5 per cent in the first quarter, but the market quickly recovered throughout the rest of the year.

Economists at Deutsche Bank said the effects from an escalation of the coronavirus would be felt in the local retail, travel and hotel and catering industries, but that these would likely recover quickly and most service, trade and manufacturing activities would not be seriously affected.

Investors are moderating their concerns over the virus,” the bank’s strategist Jim Reid said.

Government bonds were stable while the China’s offshore renminbi was flat after its weakest day in five months on Tuesday.




Best Online Trading Platform For Beginners And Professional Traders. Shares, Indices, Forex and Cryptocurrencies. Start Trading Now or Try a FREE Demo Account.




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Plus500 Review 2020

StockMarketNews.Today — Plus500 Trading Review ◊ Plus500 Review 2020 ◊ • Business & Financial News – Stock Market News Today • Best Online Trading Platform For Beginners And Professional Traders. Shares, Indices, Forex and Cryptocurrencies. Start Trading Now or Try a FREE Demo… Read More ›


How To Start Investing In 2020

StockMarketNews.Today — Over half of Americans (55%) say they are not participating in the stock market, according to a 2019 poll of over 8,000 U.S. adults conducted by MetLife…. Read More ›


Best Stock Trading Platform In Europe {2020}

⇑⇓ Best Trading Platform Europe ⇓⇑ StockMarketNews.Today — what is the best stock trading platform in Europe for 2020? ….  How To Choose The Best Online Broker in Europe { 2020 } … Best Online Trading Platform. Start Trading Now or Try… Read More ›


Best Stock Market Sectors For 2020

♦ Stock Market Predictions For 2020 ♦ StockMarketNews.Today — After another big year for the stock market and the U.S. economy in 2019, investors are looking ahead to 2020 to determine which sectors will lead the next phase of the… Read More ›




federal





◊ Plus500 Review 2020 ◊


plus-500-banner-01


• Business & Financial News – Stock Market News Today •


Best Online Trading Platform For Beginners And Professional Traders. Shares, Indices, Forex and Cryptocurrencies. Start Trading Now or Try a FREE Demo Account.


Plus500 is a streamlined broker that focuses on trading in a wide range of financial markets with relatively low spreads and no commissions but without offering many extra services. Plus500 has been in the forex and CFD business since 2008. They are registered in the U.K. and licensed by the Financial Conduct Authority (FCA).

The company offers access to a comprehensive product line including forex, stock indexes, equities, commoditiescryptocurrencies, ETFs and options. Plus500 is the first broker to introduce a bitcoin CFD in 2013. The company does not charge commissions on any of its trades.

All costs are contained within the spread for each of more than 2,000 trading instruments offered on Plus500’s WebTrader platformPlus500 Ltd. (PLUS.L) is a publicly traded company on the AIM section of the London Stock Exchange since 2013 with a £1.73 billion ($2.25 billion) market capitalization and clients in more than 50 countries around the world. Plus500 offers access to more than 2,000 trading instruments.


START TRADING NOW OR TRY A FREE DEMO ACCOUNT


Trust … the company is registered with the Financial Conduct Authority (FCA), CySEC, ASIC, FSCA, FMA, MAS, and the ISA, which provides good accountability and visibility. The company is required to take steps to ensure client funds are not comingled with corporate funds – ensuring that client money and assets are protected in the unlikely event that Plus500 becomes insolvent – by holding those funds in segregated accounts at regulated banks.

If Plus500 defaults, any shortfall of funds of up to £50,000 may be compensated for under the Financial Services Compensation Scheme (FSCS). If the custodian bank holding client funds goes into liquidation, any shortfall of funds of up to £85,000 may be compensated for under the FSCS.

Plus500 also offers Negative Balance Protection, ensuring that clients cannot lose more than they have put into their account. Guaranteed stop losses can be used on some instruments depending on market conditions but they are subject to a wider spread.

The company does not charge commissions on any of its trades. All costs are contained within the spread for each of more than 2,000 trading instruments offered on Plus500’s WebTrader platform. Large volume traders do not get a trading discount at Plus500 and the spread is the same whether you trade one lot or 1,000 lots.

There are no charges for normal withdrawals or terminating an account. However, inactivity fees kick in after an account has been idle for three months. Beginning traders can open an account with as little as £100.

Traders can qualify for a “professional” account, which offers a higher level of maximum leverage, but the costs are the same. Investors with a professional account may increase their maximum leverage ten-fold, from 1:30 to 1:300.Spreads at Plus500 were some of the lowest in the market.

Plus500 also offers access to options trading on many markets. These are very similar to plain call and put options traded on exchanges, but they are not standardized which means that the option premium can be customized for your risk tolerance and strategy objectives.


START TRADING NOW OR TRY A FREE DEMO ACCOUNT


Plus500 Deposits and Withdrawals

Plus500 Deposits and Withdrawals… This Answers the Following Questions: What is the minimum deposit for Plus500? What payment methods are accepted by Plus500? Does Plus500 accept PayPal? How to withdraw money from Plus500? How much can you withdraw from Plus500?… Read More ›

Plus500

⇑⇓ Plus500 ⇓⇑ StockMarketNews.Today — Plus500 is an international financial firm providing online trading services in contracts for difference (CFDs), across more than 2,000 securities and multiple asset classes. The company is headquartered in Israel and has subsidiaries in UK,… Read More ›


Natural Gas News Today




Best Stock Market Books For Beginners {2020}


#1 – The Intelligent Investor. (Revised Edition)

This classic text is annotated to update Graham’s timeless wisdom for today’s market conditions… The greatest investment advisor of the twentieth century, Benjamin Graham, taught and inspired people worldwide. Graham’s philosophy of “value investing” — which shields investors from substantial error and teaches them to develop long-term strategies — has made The Intelligent Investor the stock market bible ever since its original publication in 1949.

Over the years, market developments have proven the wisdom of Graham’s strategies. While preserving the integrity of Graham’s original text, this revised edition includes updated commentary by noted financial journalist Jason Zweig, whose perspective incorporates the realities of today’s market, draws parallels between Graham’s examples and today’s financial headlines, and gives readers a more thorough understanding of how to apply Graham’s principles.

Vital and indispensable, this HarperBusiness Essentials edition of The Intelligent Investor is the most important book you will ever read on how to reach your financial goals.



#2 – Stock Investing For Dummies (Business & Personal Finance)

Grow your stock investments in today’s changing environment. Updated with new and revised material to reflect the current market, this new edition of Stock Investing For Dummies gives you proven strategies for selecting and managing profitable investments. no matter what the conditions. You’ll find out how to navigate the new economic landscape and choose the right stock for different situations—with real-world examples that show you how to maximize your portfolio.

The economic and global events affecting stock investors have been dramatic and present new challenges and opportunities for investors and money managers at every level. With the help of this guide, you’ll quic