Week in Review: Going viral
The week’s main news was alarming: the novel coronavirus identified in China is being transmitted from human to human and has already spread abroad. With the Chinese New Year looming, the city of Wuhan, where the outbreak first began, has been placed under quarantine.
The outbreak has so far killed 26 people and infected hundreds. The deadliness of the disease is as yet unclear, because it is not yet known whether there are many asymptomatic carriers. But an obvious risk of further transmission comes from the Chinese New Year holiday, with around a hundred million people preparing to travel across the country to return home, in the world’s largest annual migration. Confirmed or suspected cases of the virus have already occurred in Singapore, Thailand, Vietnam, South Korea, Japan, the US and the UK. On Thursday, however, the World Health Organisation said that it was too early to declare a global emergency.
Chinese share prices slumped in response to the lockdown of Wuhan and several other cities in Hubei province. And uncertainty about the virus’s potency and reach contributed to a global stock-market malaise. The economic impact of the new virus is seen as potentially heavier than that of the SARS outbreak in 2003. This is because China is now more domestically focused and service-oriented, and because its economy is now slowing rather than growing.
Big Blue beats the Blue Monday blues
The week began with ‘Blue Monday’, supposedly the most depressing day of the year. So it was perhaps unsurprising that many global stock markets delivered somewhat downbeat performance. In the UK, the FTSE 100 was down 2.2% by Thursday’s close. The FTSE World Europe ex UK index lost 1.1% while the MSCI Emerging Markets index lost 2.1%. In the US, however, the S&P 500 barely budged over the week. The S&P 500 and the Nasdaq are at, or near, new record highs.
Some strong fourth-quarter earnings played a part in the US’s outperformance of its European peers. Most notably, IBM returned to profit, also raising its full-year guidance, following stronger-than-expected performance from its cloud-computing business. Among the other companies to beat forecasts were Abbot Labs, Capital One, Halliburton, Netflix and United Airlines.
President Trump had a busy week. Having skipped the World Economic Forum at Davos in 2017 and 2019, he attended this year’s Swiss summit to pour scorn on climate activists – or “prophets of doom”, as he put it – and deliver a stream of contentious statistics about the health of the US economy and the quality of the country’s air and water. This did not go down well with the assembled plutocrats and politicians who had, with little sense of irony, gathered in Davos to discuss inequality.
The president also had to contend with the start of his impeachment on corruption charges. The Senate’s rule-setting process for the Washington trial line ran along predictable party lines.
Or Tariff Man?
On Wednesday, President Trump renewed his threats to the European Union’s auto sector, promising “very high tariffs” on European cars in response to France’s proposed tax on digital services. A truce was agreed on Thursday. With Novembers’ presidential election fast approaching, however, trade rhetoric may bubble up and down alongside polling numbers.
Another day, another downgrade
As if rampaging viruses, tumbling stock markets and further trade tensions weren’t enough for one week, the International Monetary Fund (IMF) followed the World Bank in cutting its forecast for global growth. The IMF reduced its 2020 growth prediction by a tenth of a percentage point to 3.3%. It also cut its 2021 forecast by a fifth of a percentage point, to 3.4%.
And finally …
The bleak winter weather might be causing us humans a modicum of misery as we trudge through a wet and windy January. But spare a thought for the humble iguana. The hefty herbivorous lizards aren’t great fans of the cold, because they rely on the heat of their surroundings to warm their blood up.
And because they need warmth to stay active, iguanas are especially vulnerable to cold snaps. Once the temperature falls below 4.4° C, they simply freeze. That’s what’s been happening in Florida, where iguanas are a pervasive and invasive species. On Tuesday, falling temperatures prompted the US National Weather Service to warn of the risk of rigid reptiles tumbling from the trees.
These unfortunate iguanas might be down, but they’re not necessarily out. When temperatures rise, the reptiles revive – assuming they didn’t hurt themselves in the fall. In the meantime, the chance of reptilian precipitation makes a change from January’s propensity for raining cats and dogs.
Editorial image credit: Photo by - Cavallini James/BSIP/Universal Images Group via Getty Images
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