BEIJING — China will step up policy adjustments to help cushion the blow on the economy from a coronavirus outbreak that authorities are still trying to control, President Xi Jinping was quoted as saying on Sunday.
The situation is showing a positive trend after arduous efforts but there is no room for “weariness and relaxed mentality” among officials, state television quoted him as saying.
“At present, the epidemic situation is still severe and complex, and prevention and control work is in the most difficult and critical stage,” Xi said.
“The outbreak of novel coronavirus pneumonia will inevitably have a relatively big impact on the economy and society,” Xi said, adding that the impact would be short-term and controllable.
The outbreak is one of the most serious public health crises to confront Chinese leaders in decades.
“For us, this is a crisis and is also a big test,” Xi said.
Chinese policymakers have implemented a raft of measures to support an economy jolted by the virus, which is expected to have a devastating impact on first-quarter growth.
Low-risk provinces should focus on restoring work and production in an all-round way, provinces with medium-level risks should aim for an orderly work resumption, while high-risk regions should focus on epidemic controls, Xi said.
The government would step up policy support to help achieve economic and social development targets for 2020, Xi said.
China would maintain a prudent monetary policy and roll out new policy steps in a timely way, he said, adding the government would also study and roll out phased tax cuts to help tide small firms over difficulties.
The government would also take steps to support flexible employment and help college graduates to find jobs, Xi added. (Reporting by Yingzhi Yang and Kevin Yao; Editing by Frances Kerry and Alex Richardson)
GUNTER: Now that climate crusaders have ruined the economy, what's their solution? – Toronto Sun
Who’s going to invest in Canada now that the blockades continue and the Teck Frontier mine has been killed?
Are the environmental activists and unelected, unaccountable Indigenous blockaders going to make up the hundreds of billions in lost economic activity they have cost our economy?
Are the rich, lefty, American foundations that fund this activism going to cough up the missing cash?
What are the “green” politicians who warn of “climate emergencies” and insist Canada live up to its Paris accord emission commitments going to do to put to work the tens of thousands of Canadians who have lost or will lose their high-paying jobs in the energy sector?
Politicians like Justin Trudeau insist that for every energy-sector job lost, a wonderful, well-paying job will materialize in their new net-zero economy.
Yet nowhere this employment magic has been promised, has it ever materialized. Once the start-up subsidies from government run out, “green” jobs tend to disappear.
In short, what is the Greta Cult’s alternative to conventional economic development?
The deadly effects of “green” virus are going to spread beyond the oil and gas industry, and beyond Alberta’s economy.
When investors here and in the rest of the world see how feebly Ottawa has handled the blockading of our economy by a few hundred rent-a-mob, fringe players, they are going to decide Canada is not the place to risk their new auto assembly line, grain mill, distribution centre or yogurt plant.
The loss of Teck Resource’s Frontier oilsands project means a loss of 7,000 construction jobs (1,000 outside Alberta) and 2,500 operational jobs (about 600 in other provinces) for the mine’s 40-year lifespan.
Teck Frontier would have meant an additional $12 billion a year of GDP for Canada and upwards of $70 billion in revenues to three levels of government over the next four decades.
“Green” protestors who also demand more money for public education and health care need to ask themselves where are governments going to come up with the $70 billion in government revenues their eco-activism has cost from this one lost project alone?
And the “woke” Canadians who have supported the Wet’suwet’en hereditary chiefs via social media (Whew! Talk about true commitment), need to know that around 9% of all Indigenous income in Canada comes from the energy sector through jobs and contracts with Indigenous businesses.
That’s second only to government cheques.
Not only are you putting that existing income at risk with your tweets and re-posts about the injustice of “settler” courts and the oppression of “colonial” governments, you are also making it less likely that governments will be able to afford their current payments to First Nations, much less the extra billions Indigenous activists demand.
There’s a reason all the elected Indigenous governments (14) around Teck Frontier and all the elected Indigenous governments (20) along the Coastal GasLink pipeline route support these projects. They see them as the best way to improve the lives of their people.
So now that you social-justice warriors and climate crusaders have decided you know better than Indigenous Canadians’ own elected leaders (how very colonial of you), what’s your solution?
Don’t say more tax dollars, because you are also rapidly reducing the capacity of our overall economy to generate the tax dollars you desire.
Oh, I know, your heads are full of propaganda that the “rich” aren’t paying their fair share. But the top 10 per cent of income earners already pay 54% of all income tax. And the top 10% includes people like senior nurses, teachers and mid-level civil servants (not just greedy tycoons and robber barons).
The productive elements of Canadian society have tried. You’ve stopped them. So get down off the barricades and tell us your plan.
Stock markets sell off again as global economy infected by coronavirus fear – CBC.ca
Stock markets fell for the second day in a row on Tuesday, wiping out gains since the start of the year, as fear over the coronavirus is spreading even faster than the virus itself.
The Dow Jones Industrial Average closed down 879 points or just over three per cent to 27,081. The technology-focused Nasdaq was off by almost as much, 255 points or 2.7 per cent, while in Toronto the TSX/S&P Composite Index was off by 385 points or just over two per cent to 17,177.
The sell-off came a day after an even worse swoon on Monday, as investors digest the possibility that the virus that causes COVID-19 has the potential to disrupt the global economy by knocking out supply chains and reducing consumer demand for a range of goods and services.
On Tuesday, Iran reported 95 new cases and 15 new deaths from the coronavirus that started in China, while Italy is also seeing a growing cluster of new cases.
“For the first time in a while we’re finally waking up to the fact that this issue could go on for a while, and have a significant impact on Chinese and global economic growth and potentially the United States,” said Randy Frederick, vice-president of trading and derivatives for money manager Charles Schwab.
“When people react to it because they don’t travel or go to restaurants or go shopping, that’ll have an immediate impact on the economy. It depends how long it goes and how wide the spread.”
Yung-Yu Ma, chief investment strategist at BMO Wealth Management, said each new country’s outbreak adds to the fear. “It’s the combination of South Korea, Japan, Italy and even Iran” reporting virus cases, Ma said.
“That really woke up the market, that these four places in different places around the globe can go from low concern to high concern in a matter of days, and that we could potentially wake up a week from now and it could be five to 10 additional places.”
The two day sell-off on the Dow Jones is the worst two-day performance for the Dow since 2015.
After a multi-year bull run, the sell-off has pushed almost every major stock index in the world into negative territory for the year.
Just about every sector is down this week.
“It’s a case of which ones went down more, and which ones that went down less,” said Colin Cieszynski, chief market strategist at SIA Wealth Management in Toronto.
Companies tied to travel and tourism are especially hard hit. Air Canada, for example, was down six per cent to $36.45 a share on Tuesday and down 27 per cent since the middle of January. The airline announced Tuesday it has cancelled all of its flights to China until the end of April.
Shares in cruise lines are sharply lower. Norwegian Cruise Lines lost seven per cent of its value on Tuesday and is down by more than a third since the middle of January. Its rival, Carnival Cruise Lines, lost another six per cent on Tuesday and it, too, is down by more than 30 per cent in barely more than a month.
“With travel slowing down we’ve seen an impact on the airline sector, on the hotels and casinos, on cruise lines and … where people would gather in a public place,” Cieszynski said.
Oil prices have plunged as the virus has prompted fears that the global economy will require less energy to run as it slows down.
The benchmark oil price, known as West Texas Intermediate, dipped below $50 US a barrel on Tuesday, a level it hasn’t dropped to since late 2018.
That hit Toronto’s stock exchange hard as the TSX is home to a lot of energy names.
Conversely, Canada’s main stock index was buoyed by rising prices in gold mining companies. The price of gold has risen to more than $1,600 US an ounce this month, a level it hasn’t topped since 2013, because gold is seen as a safe haven in times of uncertainty.
“In Canada we will often see on days when the broader markets are taking a big hit, we’ll often see strength in the gold price and gold stocks,” Cieszynski said.
“That often will help to cushion the blow a little bit in Canada relative to the United States.”
While most industries have been hit hard by virus fears, there are some bright spots moving in the opposite direction because of the flip side of those same fears.
Drug companies working on possible vaccines are seeing their share prices rise, including one called Moderna that is up by almost 17 per cent on Tuesday because it has sent a possible coronavirus vaccine to a clinical trial to be tested on humans.
The fears of the coronavirus derailing the world’s economy come at a time when another closely watched economic indicator — earnings at Canadian banks — suggest that Canada’s economy is doing well.
Royal Bank of Canada reported strong earnings on Monday, and rivals BMO and Scotiabank followed that up with higher profits of their own on Tuesday. Despite the relatively strong showings, shares in all three banks were lower on Tuesday.
For economy skeptics, stock sell-off is 'an opportunity to exit' – BNNBloomberg.ca
It’s been a long time since anyone felt safe selling equities. Now, with panic-inducing headlines everywhere, investors who had been stockpiling reasons to bail are exiting positions with less fear of looking foolish.
At least, that’s how several money managers explained deepening losses Tuesday that sent the Dow Jones Industrial Average hurtling toward the brink of another 1,000-point tumble and total declines past 8 per cent. Rather than buy dips, investors are selling into strength.
“There’s certainly people who have doubted this rally all the way up and will now use this as an opportunity to exit,” said Brent Schutte, chief investment strategist at Northwestern Mutual Wealth Management Co. “The one consistent call I’ve heard for the past four or five years is that a recession is coming and certainly this emboldens those people who believe that. It may mean we have further downside to go.”
The bull market, approaching its 11-year anniversary, has always irritated a category of skeptics who say that without Federal Reserve largess the U.S. economy would have long ago stopped expanding. Recession anxiety rose last year when short- and long-term Treasury rates inverted, an indicator that has reliably preceded past downturns.
At the same time, acting on any such belief has been enormously costly. Roughly US$4 trillion of share value has been added to U.S. equities since October. Before last week the S&P 500 had fallen on successive days just once in 2020.
Now stocks are down 7 per cent from their Feb. 19 record in the first drop of this magnitude since August, when the S&P 500 lost 6 per cent in six days. Traders have pulled almost US$9.4 billion from State Street’s S&P 500 ETF, ticker SPY, in the past two days, the biggest back-to-back withdrawal since March 2018, according to data compiled by Bloomberg.
In short, people waiting for a signal to sell have gotten one. Amid the pullback, Donald Selkin, chief market strategist at Newbridge Securities Corp., took the opportunity to unload shares of Tesla Inc., which has run up close to 100 per cent this year. He also got rid of shares of airline companies as well as certain health care firms, which looked vulnerable.
“Stocks have made tremendous runs so why not take some money off the table?” Selkin said in a phone interview. “I can see the rationale for selling.”
Cantor Fitzgerald’s Peter Cecchini has long believed that the optimism propping up the bull market was misplaced. A rebound in global economic data has failed to materialize, he says, while U.S. earnings, flat in 2019, aren’t bouncing back. Arguments that this time is different when it comes to the inverted yield curve don’t convince him.
“Market participants have been accepting bullish narratives without much critical thought,” Cecchini, Cantor’s chief global market strategist, wrote in a note this week. “When narratives are so thinly supported by empirics, they may continue to persist, but the skin of the bubble begins to thin and is vulnerable to even the slightest prick.”
Bulls take solace in the Fed’s bulging balance sheet. But while the central bank cut rates three times last year, many fear it won’t have ample ammunition to fight future slowdowns. The Fed has said it will continue its repurchase operations at least through April, but ultimately wants to step back from active involvement once reserves rise enough to ensure liquidity.
“Every market rout in the past five years, you had the Fed step in and help us out — by either lowering rates or pausing tightening,” Michael O’Rourke, JonesTrading’s chief market strategist, said in a phone interview. “We are going through this supply and demand issue, we are seeing a global virus outbreak. There isn’t much the Fed can do from a policy perspective and not artificially inflate asset prices.”
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