Coronavirus update: Global spread hits 'unchartered territory' as volatile markets rebound; US death total jumps

·Senior Reporter

Updated Mon, Mar 2, 2020, 12:38 PM4 min read

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The coronavirus outbreak continued its relentless spread to other countries with the number of infections and deaths rising, forcing governments worldwide to race against the clock to prevent a pandemic.

Global markets staged a recovery on Monday following a sustained selloff last week that was the worst investors have seen since the financial crisis. Yet the COVID-19 outbreak dominated market sentiment, with over 87,000 infected worldwide and more than 3,000 dead. Infections numbers have also been surging in hard-hit areas like Italy, South Korea and Iran.

Over the weekend, the U.S. reported nearly a dozen new cases and the first set of domestic deaths from the disease — bringing the country’s total to 6. And in certain areas, the growing sense of alarm has spurred panic buying of consumer staples like sanitizer and face masks.

The World Health Organization director general said Monday that Covid-19 outbreak is still not a pandemic, and global health officials believe there is still scope to end the outbreak.

Yet within countries where the outbreak is spreading rapidly, the mood is grim — compounded by the WHO’s own warning on Friday about global risks being on the rise.

“We are in unchartered territory. We have never before seen a respiratory pathogen that is capable of community transmission, but which can also be contained with the right measures,” the WHO’s Tedros Adhanom Ghebreyesus said.

President Donald Trump met with drugmakers Monday for what was originally set to be a discussion about drug pricing, to determine the status of treatments and vaccines. Meanwhile, Congress is set to fund an emergency response of as much as $8 billion for the U.S. response of the coronavirus outbreak.

Trump, along with the coronavirus task force, told reporters Saturday that the U.S. would impose travel advisories and restrictions on hard hit areas like Iran, South Korea and parts of Italy. He also said the mask maker, industrial giant 3M (MMM), has been instructed to produce 35 million more of the N95 masks monthly.

The global total is nearing 90,000, with the death toll having topped 3000.

Recession fears rise

While major U.S. benchmarks soared in intraday trading on Monday, Wall Street economists were quickly revising down their expectations for U.S. and worldwide growth — and ratcheting up expectations of easing from the Federal Reserve.

Amid the outbreak, the Paris-based Organization for Economic Co-operation and Development lowered its 2020 global economic growth forecast to 2.4%, from 2.9%, marking the weakest pace of growth since 2009.

This week will bring a slew of economic data for investors to chew on, but few of them will actually reflect the virus’ impact.

However, some data already has: China’s Caixin/Markit Manufacturing Purchasing Managers’ Index (PMI) registered at 40.3 for February, its lowest ever reading. Prints below 50 indicate contraction in a sector.

Mark Vitner, managing director and senior economist at Wells Fargo, told Yahoo Finance on Monday that chances of a recession were low at the start of the year — but have now jumped to 30% because of the virus. It remains to be seen how the outbreak plays out, he added.

Separately, key sectors like travel, leisure and entertainment continue to bear the brunt of the virus spread.

American Airlines (AAL) continues to be pummeled, trading at its lowest since 2013. United Airlines and Delta are also feeling the pain. Various airlines are waiving change and cancelation fees as uncertainty around travel continues to slow down sales.

‘Very speculative’

The severity and lethality of the virus remain the biggest wild card, with isolated cases popping up in the Dominican Republic, Nigeria and Brazil that are adding to widespread fears of a pandemic. In places like South Korea, Italy and Iran, the toll continues to mount with no end in sight.

“It could become a virus that circulates around the world for many years to come,” former Centers for Disease Control (CDC) director Tom Frieden said on Monday.

China, meanwhile, continues to see a daily decrease in reported cases; yet the epicenter of the outbreak is by far the largest stronghold of all cases and deaths.

Harvard University epidimiology professor Marc Lipsitch, who spoke at an event hosted by the university’s medical school, said the number of cases reported is likely an underrepresentation of the outbreak.

That is because there are a bulk of cases that have not yet been detected — including those that have resulted in deaths.

“So all those numbers are very speculative and very much in flux,” he said.

Anjalee Khemlani is a reporter at Yahoo Finance. Follow her on Twitter: @AnjKhem