Baltic Dry Index. 603 -14 Brent Crude 27.98 Spot Gold 1608
Covid-19 Pandemic finally
underway, according to the WHO, at long last!
Coronavirus Cases 25/3/20
World 434,595 Deaths 19,603 (Maybe.)
The World Health Organization said on Tuesday the United States
had the potential to become the global epicenter of the pandemic, citing a
“very large acceleration” in coronavirus infections.
US stock markets
staged a massive “good news” relief rally yesterday, premised on the belief
that finally US politicians will agree on a 1 to 2 trillion dollar relief
package for the US economy.
To this old
dinosaur market watcher, relief rallies are excellent sell out opportunities to
get out of risky stocks and get back to much safer cash. Let greater fool
buyers take the risk that this coronavirus crisis is far from over, and in America
itself might just be beginning.
Besides, even an
extra 1 to 2 trillion dollars of helicopter money dropped into the US economy,
still looks to be a dollar short and a day late for the damage already hitting
the US economy, and if the WHO is correct about the USA about to replace Europe
as the epicentre of coronavirus crisis a global depression still lies directly
ahead.
Below, yesterdays
fast and furious developments.
Treat with caution: rocketing stocks aren't cause for comfort
March 25, 2020 /
5:09 AM
NEW YORK (Reuters) - Those pining for a
bottom to the gut-wrenching stock market selloff may be disappointed to learn
that mega one-day rallies like the historic one witnessed on Tuesday are
typically not the start of a durable recovery.
U.S. stocks, that recently entered a bear market - a fall of 20% or more from recent highs - rebounded strongly on Tuesday after U.S. lawmakers said they were close to a deal for an economic rescue package in response to the coronavirus outbreak, injecting optimism to a market grappling with its biggest selloff since the financial crisis.
The Dow Jones Industrial Average .DJI soared 11.37%, its largest one-day percentage gain since 1933, while the S&P 500 .SPX jumped 9.38% to 2,447.33, its biggest one-day percentage rise since 2008.
All the same, data suggest investors should treat the rally in stocks with caution.
Of the twenty past instances when the S&P rallied 8% or more on a single day, thirteen of them took place when stocks were in the embrace of a bear market.
“These 8% rallies are not necessarily signs of health,” said Christopher
Murphy, co-head of derivatives at Susquehanna Financial Group.
In a note on Tuesday, Murphy wrote, “It is important to remember that
some of the largest one‐day rallies in SPX’s history took place during bear
markets, implying that one day pops are not uncommon in a down market.”
Nor are such sharp rallies a herald of better days.
In 2008, for instance, the two biggest gains during the market crash
that fall, both in October 2008, were actually followed by five more months of
double-digit declines, data showed.
---- A lot will depend on whether monetary and fiscal response can stave off a prolonged downturn,
Krosby said.
Going by history, those looking to time the end of the bear market
should be more encouraged by days when investors take modest bites at risky
assets rather than great big mouthfuls.
In 2009, the bull market was born with a 6.4% up day for the S&P
500. In 2002/2003 the recovery began with 3% up days.
Flash eurozone PMI plunges to worst-ever reading in March
Published: March 24, 2020 at 5:12 a.m. ET
The flash eurozone composite purchasing
managers index in March plummeted to a reading of 31.4 from 51.6 in February,
which is a record low since the series began in July 1998. The services PMI
plunged to 28.4 from 52.6 in February.
Any reading below 50 indicates contracting
conditions. "The March PMI is indicative of GDP slumping at a quarterly
rate of around 2%, and clearly there's scope for the downturn to intensify
further as even more draconian policies to deal with the virus are potentially
implemented in coming months," said Chris Williamson, chief business
economist at IHS Markit.
U.K. composite PMI slumps to survey low of 37.1 in March
Published: March 24, 2020 at 5:37 a.m. ET
The flash U.K. composite purchasing
managers index fell in March to a survey low of 37.1 from 53 in February,
according to the latest data from IHS Markit/CIPS. Any reading below 50
indicates deteriorating conditions.
The services index plunged to a record low
35.7 from 53.2. "Historical comparisons indicate that the March survey
reading is consistent with GDP falling at a quarterly rate of 1.5-2.0%, a
decline which is sufficiently large to push the economy into a contraction in
the first quarter.
However, this decline will likely be the
tip of the iceberg and dwarfed by what we will see in the second quarter as
further virus containment measures take their toll and the downturn
escalates," said Chris Williamson, chief business economist at IHS Markit.
No, China’s economy hasn’t gotten better. The implications could be more serious than investors realize
Published: March 24, 2020 at 6:18 a.m.
ET By Andrea
Riquier
Just how bad is the economic situation in China? In late February, MarketWatch interviewed Leland Miller, CEO of the China Beige Book, who warned that economic deterioration caused by the novel coronavirus was, as we put it, “worse than you think.” On Monday, Miller’s firm released a fresh report that confirms that earlier view.
His takeaway now: for investors, the notion of “worse than you think” only tells part of the story.
With more firms reporting in for the final first-quarter tally, Miller said, results are worse, even as parts of the country unwind government restrictions on movement and travel intended to contain the spread of the deadly pathogen. As CBB’s report puts it, “results continued to deteriorate even into mid-March when most firms were re-opening and supposedly ‘back to work’.”
Miller thinks it is critical that investors understand how bad the downturn in China is so that they can read official reports with some healthy skepticism. “There’s going to be mixed signals sent to markets,” he said. “Gloom in Europe and the U.S. but growth in China. That will be very alluring. But it will be wrong.”
Specifically, Miller expects the Chinese government will report a “March recovery” and then data from then on “will shoot to the moon.” That will help China appear to have met President Xi Jinping’s growth targets.
But investors need to understand that the Chinese economy hasn’t just fallen off a cliff because it was the epicenter of the blow from the coronavirus, Miller said. It is also because of the way the virus is now rippling around the world. “The China recovery story is no longer just about domestic resilience, but also factors beyond Beijing’s control,” the report explained.
“Chinese factories went down just when the world badly needed auto parts supplies,” Miller said in an interview. Wuhan, China, where COVID-19 was first identified in December, is an auto-manufacturing hub in Hubei province. “Now those factories are being cranked back online just as demand falls off a cliff. You’ll have an oversupply.”
-----What next? In the short term, that oversupply could lead not just to destabilized global markets but to more trade tensions. President Donald Trump’s administration made supply gluts a major pillar of its negotiations with China.
But in the long term, Miller thinks, global interconnectedness will be the biggest victim of the illness derived from the novel strain of coronavirus. Firms have spent years thinking about rerouting supply chains away from China. And between the trade war throughout 2019 and the coronavirus now, “this might finally be the point where people say, no mas. There are too many implications,” he said, suggesting that countries may adopt more isolationist policies and reroute supply chains.
More
Barclays cuts 2020 crude forecasts by $12 on virus, OPEC+ deal collapse
March 24, 2020 /
5:35 AM
(Reuters) - Barclays on Tuesday slashed its oil price forecasts for
2020, citing considerable downward pressure on the market from a Saudi-Russian
price war and demand disruption because of the coronavirus.
The bank lowered its 2020 price outlook for Brent and West Texas
Intermediate by $12 each to $31 and $28 per barrel respectively.
“Prices are likely to remain under pressure until the virus situation
turns the corner, and if we continue on the projected market balances path,
even Saudi Arabia and Russia will not be immune from the price fallout,”
analysts at the bank wrote in a note.
It joined several other banks in slashing their oil price forecasts on
account of the collapse of an output curb deal amongst members of the
Organization of the Petroleum Exporting Countries and allies, or OPEC+, as well
as the demand hit from the virus.
Barclays also forecast global available onshore storage capacity at
about 1.5 billion barrels with an estimated oversupply of over 5 million
barrels per day (bpd) for this year and an oversupply of 10 million bpd on
average for second quarter.
Meanwhile, “strategic petroleum reserve (SPR) purchases by the U.S
government are unlikely to alleviate U.S. producers’ pain,” the bank said.
The available SPR storage is less than 80 million barrels, according to
Department of Energy data, and would amount to a flow of less than 0.5 million
bpd when filled over a period of six months, compared with almost 10 million
barrels of projected oversupply over the second quarter, it added.
Oil prices rose on Tuesday on hopes that the United States will reach a
deal soon on a $2 trillion virus aid package which could blunt the economic
impact of the outbreak and in turn support oil demand.
Goldman Sachs says it is time to buy gold — the ‘currency of last resort’
Published: March 24, 2020 at 5:53
a.m. ET
The current coronavirus-induced economic and financial
market turmoil is seemingly the perfect environment for gold.“We have long argued that gold is the currency of last resort, acting as a hedge against currency debasement when policy makers act to accommodate shocks such as the one being experienced now,” said analysts at Goldman Sachs led by Jeffrey Currie.
Yet while the yellow metal GC00, 4.300% has done far better than other assets, it has slipped 2% over the last month.
The Goldman analysts, with a 12-month price target of $1800 an ounce, said that is about to change, thanks to the Federal Reserve’s aggressive bond purchase plan unveiled on Monday, in which the U.S. central bank said it would buy as many Treasurys and mortgage-backed securities as needed to keep financial markets running smoothly.
The Goldman analysts said gold has been weighed down by a world in need of dollars, requiring forced sales of liquid assets like gold. The downturn in oil CL.1, 6.807% as Saudi Arabia and Russia fail to agree on production cuts has also created dollar shortages for emerging market economies, which may have made Russia a net seller of gold, according to Goldman.
In 2008, the Goldman analysts noted, the November announcement of quantitative easing was a turning point.
---- “We are beginning to see a similar pattern emerge as gold prices stabilized over the past week and rallied [Monday] as the Fed introduced new liquidity injection facilities with this morning’s announcement,” they said.
The analysts that said with the Fed easing funding stresses, focus will
likely shift to the large size of the Fed balance sheet expansion, increase in
developed market fiscal deficits and concerns about the sustainability of the
European monetary union.
“We believe this will likely lead to debasement concerns similar to the
post [Global Financial Crisis] period,” they said.
Finally, more on the stll growing
coronavirus crisis, and a little of the science behind tackling viruses old and
new, Ro, aka R naught.
Coronavirus sweeps across New York, California fears it could be next
March 24, 2020 / 10:43
AM
NEW YORK/ LOS ANGELES (Reuters) - New York
state suffered another quick and brutal rise in the number of COVID-19 cases on
Tuesday, staggering hospitals at the U.S. epicenter of the coronavirus
epidemic, as California said it could be facing the next major wave of the
disease.
In New York City, the densely packed home of more than 8 million people,
healthcare officials tried to find hospital beds for the surging number of
coronavirus patients as the statewide death toll rose to 210, with more than
25,600 confirmed cases.
The White House advised anyone who has visited or left New York to
isolate themselves.
Everybody who was in New York should be self-quarantining for the next
14 days to ensure that the virus doesn’t spread to others, no matter where they
have gone, whether it’s Florida, North Carolina or out to far reaches of Long
Island,” Deborah Birx, who is helping lead the White House coronavirus tax
force, said at a late-afternoon press conference.
The expected need for hospital beds in New York state at the peak of the
outbreak has spiraled to 140,000, nearly three times what are available.
Infections were now doubling every three days in New York and the worst could
still be two to three weeks away, said New York Governor Andrew Cuomo.
----
President Donald Trump declared major disasters for New York
and Washington state, the nation’s first hot spot and accounting for at least
117 deaths, and said he would soon do the same for California.
---- In California, where 51 people have
died and 2,200 tested positive, Governor Gavin Newsom said fully half the
confirmed cases were between the ages of 18 and 49, figures he said are “a
reminder for everybody to take this seriously.”
Newsom, who warned that half of Californians - or about 25 million
people - could potentially be infected in the coming two months, said the next
six to eight weeks would be pivotal in determining whether a clampdown on
residents has slowed the spread of coronavirus.
California also desperately lacks the hospital beds it needs to care for
so many critically ill patients, Newsom has said, although Tesla co-founder
Elon Musk “came through on his promise” to deliver over 1,000 badly needed
hospital ventilators, and the state brought another 3,000 online.
The U.S. Navy hospital ship Mercy was expected to arrive at in Los
Angeles on Friday with 1,000 hospital beds to ease the burden on the state’s
healthcare system.
----
The World Health Organization said on Tuesday the United
States had the potential to become the global epicenter of the pandemic, citing
a “very large acceleration” in coronavirus infections.
More
Japan's capital becomes centre of its coronavirus epidemic
March 25, 2020 /
5:24 AM
TOKYO (Reuters) - Japan’s capital of Tokyo is at the centre of its
coronavirus epidemic with more cases than any other region after a record
number in a single day, data from public broadcaster NHK showed.
Tokyo registered a record 17 new cases on Tuesday, taking its tally to
171, and overtaking the hard-hit northern island of Hokkaido island as the
prefecture with the most infections, NHK reported.
The outbreak has infected 1,214 people in Japan as of late Wednesday
morning, with 43 deaths linked to the virus, NHK said. That excludes 712 cases
from a cruise ship moored near Tokyo last month.
The International Olympic Committee and Japanese government on Tuesday
agreed to put back the Tokyo 2020 Olympics to 2021 over the outbreak.
Tokyo’s new infections came after Governor
Yuriko Koike warned that a lockdown of the capital was possible if it saw an
explosive rise in cases.
More
What Is R0?: Gauging Contagious Infections
R0 is pronounced “R naught.” It’s a mathematical term that
indicates how contagious an infectious disease is. It’s also referred to as the
reproduction number. As an infection spreads to new people, it reproduces
itself.
R0 tells you the average number of people who will catch a
disease from one contagious person. It specifically applies to a population of
people who were previously free of infection and haven’t been vaccinated. If a
disease has an R0 of 18, a person who has the disease will transmit
it to an average of 18 other people, as long as no one has been vaccinated
against it or is already immune to it in their community.
- If R0 is less than 1, each existing infection causes less than one new infection. In this case, the disease will decline and eventually die out.
- If R0 equals 1, each existing infection causes one new infection. The disease will stay alive and stable, but there won’t be an outbreak or an epidemic.
- If R0 is more than 1, each existing infection causes more than one new infection. The disease will spread between people, and there may be an outbreak or epidemic.
- no one has been vaccinated
- no one has had the disease before
- there’s no way to control the spread of the disease
More
If you can keep your head
when all about you. Are losing theirs and blaming it on you, you’re just not up
to speed on the crisis unfolding.
With
apologies to Rudyard Kipling.
Crooks and Scoundrels Corner
The bent, the seriously bent, and the totally doubled
over.
Today, a calamity starts to
descend on Asia’s poor especially in India.
Indians scramble for supplies as three-week coronavirus lockdown begins
March 25, 2020 /
4:56 AM
NEW
DELHI/BENGALURU (Reuters) - Indians crowded grocery stores and chemists on
Wednesday in a struggle for essential items after Prime Minister Narendra Modi
ordered a total lockdown for three weeks to fight a coronavirus pandemic, one
of the toughest such measures worldwide.
India’s tally of 536 cases and 10 deaths is dwarfed by China, Italy and
Spain, but Modi and health experts have warned that the nation of 1.3 billion
people faces a tidal wave of infections if harsh steps are not taken.
People in the key cities of Delhi, Mumbai and Bengaluru rushed to stock
up after Modi decreed the shutdown in a speech televised nationwide, barely
four hours before it took effect.
As states shut their borders, long queues of trucks carrying milk,
fruits and vegetables snaked down highways, even though Modi said essential
services would be maintained countrywide.
“There are no clear instructions, police are telling us to close down the shop,” said Ram Agarwal, a grocer in Delhi swamped by people looking to buy dry food supplies and milk.
Disruptions to online services added to people’s woes.
Walmart Inc’s (WMT.N) Flipkart has suspended services, the Indian e-commerce firm said in a notice on its website as the lockdown began. Amazon India’s pantry service, which delivers groceries, was also not available in several cities.
Anthony Thomas, a worker at a small online milk delivery service, who normally distributes 150 litres of milk and groceries in Delhi each morning, said his employer had told him to stay home.
More
https://uk.reuters.com/article/uk-health-coronavirus-southasia/indians-scramble-for-supplies-as-three-week-coronavirus-lockdown-begins-idUKKBN21C0II?il=0
India's poor, hammered by coronavirus lockdown, fear for future
March 24, 2020 /
2:05 AM
MUMBAI
(Reuters) - Shaikh Bahaduresha, 31, lived on Mumbai’s streets for two months
last year, unable to make ends meet on his meagre taxi-driving profits of
roughly $5 a day. After he got married in December, his wife put some money
towards renting a small apartment, and they moved in together.
But with much of India now under lockdown to fight the coronavirus,
Bahaduresha’s newfound stability could come crashing down.
He has no more taxi customers, which means he cannot afford food beyond
rice and lentils, and will not be able to pay his rent, due on Tuesday.
“I have no savings. My wife and I will be on the street again,” said
Bahaduresha as he waited in vain next to shuttered stores for a cab owner who
he said owed him a deposit. “The USA is a VIP country, you can block it for a
month and it’s okay, but in India you have to take care of the poor.”
Prime Minister Narendra Modi has urged India’s 1.3 billion people to
stay home and the majority of the country is under lockdown. As of Monday,
India had reported 471 cases of the virus and nine deaths.
A dozen Indians living in Mumbai’s sprawling Dharavi slum said they
supported the clampdown, but wanted government support.
The issue highlights how difficult it is for countries to tackle the
virus without destroying livelihoods - a challenge that is especially acute in
developing nations with significant populations living hand-to-mouth.
“So far, the prime minister’s intervention has put the onus of
responsibility on citizens ... but it has fallen short of explaining clearly
what the state is going to do,” said Gilles Verniers, a political science
professor at Ashoka University near New Delhi.
“There is nothing that looks like a national plan on the social front.”
The prime minister’s office did not immediately respond to a request for
comment.
Some markets near the slum were closed and vendors still selling
vegetables on the pavement said their distributors were no longer supplying
them.
Dharavi residents said they were stretching out meals and forgoing
pricier foods such as mutton. Khatun, a frail 70-year-old, wept on her bed as
she recounted that her son, who does odd painting jobs, was out of work.
Ajay Kewat, 21, said his family only had provisions for a few more days:
“I’m afraid that after a week, there won’t be food.”
India bans export of key malaria drug amid coronavirus outbreak
March 25, 2020 /
5:18 AM
NEW DELHI (Reuters) - The Indian government said on Wednesday that it is
banning the export of hydroxychloroquine and formulations made from the
medication, as experts test the efficacy of the drug in helping treat patients
infected with COVID-19.
There are currently no approved treatments, or preventive vaccines for
COVID-19, the highly contagious, sometimes deadly respiratory illness caused by
the new coronavirus. Researchers are studying existing treatments and working
on experimental ones, but most current patients receive only supportive care
such as breathing assistance.
Hydroxychloroquine, a malaria drug, is among the medications that are
being tested, as a potential treatment for patients with the disease. Earlier
this week, the American Society of Health-System Pharmacists (ASHP), which
maintains a list of drug shortages, said hydroxychloroquine was in shortage.
“Chloroquine has demonstrated toxicity in certain patients,” Dinesh Dua,
chairman of the Pharmaceuticals Export Promotion Council of India, told
Reuters. “You have to tread with caution because there is no comprehensive data
to prove it works.”
The group said India faced no shortages of the drug but they warned
companies were facing acute shortages of staff to run operations.
----
India has already banned export of all ventilators and
sanitizers and personal protection equipment such as masks and clothing to
contain the outbreak that has so far infected more than 550 people and claimed
close to a dozen lives in the country.
More
Vietnam closes Ho Chi Minh City restaurants to curb virus outbreak
March 24, 2020 /
8:58 AM
HANOI (Reuters) - Restaurants in Vietnam’s business hub, Ho Chi Minh
City, must close until March 31 to help curb the spread of the coronavirus, the
city’s ruling body said on Tuesday.
Ho Chi Minh City has recorded 39 cases of the virus, most of which were
imported from Europe, and has already closed cinemas, clubs, bars, massage
parlors and karaoke lounges since the virus outbreak began.
“All restaurants with a capacity of over 30 people across the 24
districts of the city must cease operations from 18:00 March 24, until the end
of March 31,” the city’s ruling body said in a statement.
The move has been taken because some infected people spread the disease
at popular restaurants and bars in the city, according to Vietnam’s health
ministry.
In mid-February, Vietnam said all 16 of its confirmed coronavirus cases
had recovered, but it has since been battling with an influx of imported cases
from overseas visitors and Vietnamese citizens escaping outbreaks elsewhere.
There are now 123 cases in the Southeast Asian country, but no reported
deaths, according to the health ministry. Over 50,000 people are in quarantine.
The
next 10-15 days will be decisive in Vietnam’s fight against the coronavirus,
Vietnam’s prime minister Nguyen Xuan Phuc said on Monday.
Technology Update.
With events happening
fast in the development of solar power and graphene, I’ve added this section.
Updates as they get reported. Is converting sunlight to usable cheap AC or DC
energy mankind’s future from the 21st century onwards.
Graphite nanoplatelets on medical devices kill bacteria and prevent infections
Date:
March 23, 2020
Source:
Chalmers University of Technology
Summary:
Graphite nanoplatelets integrated into plastic medical surfaces can prevent
infections, killing 99.99 per cent of bacteria which try to attach -- a cheap
and viable potential solution to a problem which affects millions, costs huge
amounts of time and money, and accelerates antibiotic resistance.
Graphite nanoplatelets integrated into plastic medical surfaces can
prevent infections, killing 99.99 per cent of bacteria which try to attach -- a
cheap and viable potential solution to a problem which affects millions, costs
huge amounts of time and money, and accelerates antibiotic resistance. This is
according to research from Chalmers University of Technology, Sweden, in the
journal Small.
Every year, over four million people in Europe are affected by
infections contracted during health-care procedures, according to the European
Centre for Disease Prevention and Control (ECDC). Many of these are bacterial
infections which develop around medical devices and implants within the body,
such as catheters, hip and knee prostheses or dental implants. In worst cases
implants need to be removed.
Bacterial infections like this can cause great suffering for patients,
and cost healthcare services huge amounts of time and money. Additionally,
large amounts of antibiotics are currently used to treat and prevent such
infections, costing more money, and accelerating the development of antibiotic
resistance.
"The purpose of our research is to develop antibacterial surfaces
which can reduce the number of infections and subsequent need for antibiotics,
and to which bacteria cannot develop resistance. We have now shown that
tailored surfaces formed of a mixture of polyethylene and graphite
nanoplatelets can kill 99.99 per cent of bacteria which try to attach to the
surface," says Santosh Pandit, postdoctoral researcher in the research
group of Professor Ivan Mijakovic at the Division of Systems Biology,
Department of Biology and Biotechnology, Chalmers University of Technology.
Infections on implants are caused by bacteria that travel around in the
body in fluids such as blood, in search of a surface to attach to. When they
land on a suitable surface, they start to multiply and form a biofilm -- a
bacterial coating.
Previous studies from the Chalmers researchers showed how vertical
flakes of graphene, placed on the surface of an implant, could form a
protective coating, making it impossible for bacteria to attach -- like spikes
on buildings designed to prevent birds from nesting. The graphene flakes damage
the cell membrane, killing the bacteria. But producing these graphene flakes is
expensive, and currently not feasible for large-scale production.
"But now, we have achieved the same outstanding antibacterial
effects, but using relatively inexpensive graphite nanoplatelets, mixed with a
very versatile polymer. The polymer, or plastic, is not inherently compatible
with the graphite nanoplatelets, but with standard plastic manufacturing
techniques, we succeeded in tailoring the microstructure of the material, with
rather high filler loadings, to achieve the desired effect. And now it has
great potential for a number of biomedical applications," says Roland
Kádár, Associate Professor at the Department of Industrial and Materials
Science at Chalmers.
More
I learned early that there is nothing new
in Wall Street. There can’t be because speculation is as old as the hills.
Whatever happens in the stock market today has happened before and will happen
again. I’ve never forgotten that.
Jesse Livermore
The Monthly Coppock Indicators finished February
DJIA: 25,409 +75 Down. NASDAQ: 8,567 +171 Up.
SP500: 2,954 +133 Up.
In current circumstances,
this is no time to be blindly following technical signals. Given the
severity of the still growing coronavirus crisis, I wouldn’t follow technical
signals in what I think will turn into the first depression since the 1930s.
Barring a miracle recovery in all three markets, the monthly Coppock indicators
are heading for a reversal at the month-end.
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