Dow futures drop nearly 700 points as coronavirus spread stirs fears of global economic impact

Dow futures drop nearly 700 points as coronavirus spread stirs fears of global economic impact

What’s driving the market?
https://www.marketwatch.com/story/u...ncern-of-outbreaks-economic-impact-2020-02-23

“The number of confirmed coronavirus cases outside of China continued to multiply over the weekend, sending shivers across financial markets as investors were forced to reassess their view that the impact of the outbreak will likely be short-lived,” said Raffi Boyadjian, senior investment analyst at XM, in a note.

Authorities in northern Italy canceled some public events, including Venice’s Carnival, in an effort to reduce the spread of the virus. Italian officials said Sunday they have 152 confirmed cases, the most in any country outside Asia. European stock markets fell sharply at the open, with the FTSE MIB Italy index I945, -5.03% slumping over 4%.

South Korea reported 70 more cases and Iran said the death toll from the city of Qom is 50.

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The 'implied' open is now -828. I have some thoughts on this market correction. There have been pandemic viruses in the recent past such as SARS , H1N1, etc. The stock market correction is being blamed on the coronavirus. Personally, I think the selloff has nothing to do with the coronavirus. There's been 2,600 deaths worldwide, 80,000 known cases.

There was 16,000 deaths last year in the U.S. alone attributed to the regular flu. China alone has 1.3 billion people so why are 2,600 combined deaths worldwide cause a panic?

I believe the world is in financial trouble and the economy was artificially inflated. I think this panic selloff is intentional as a market correction. China is ordering small industries and businesses to close which is going to create shortages, creating fear in the market.

 

You need one of these:

 

It interrupts the supply chain. We (i.e. The West) have allowed China to make nearly everything we purchase because of price point. When Americans simply refuse to buy any product not made in America - despite higher costs - the market won't need to "correct" itself any longer. E.g.:

https://www.8newsnow.com/news/local...ased-collectible-model-airplanes-gemini-jets/

.

 

They are now saying that COVID-19 has a greater than 10% mortality rate while influenza avg around 6.8. The problem, however, COVID-19 is transferable merely through the air and is extremely contagious. The markets are absolutely rocking based upon a pandemic scare as it's a real threat.

 

Any drop in demand from China is obviously going to ripple through the World Economy.

https://www.cnbc.com/2020/02/24/oil-markets-coronavirus-oil-demand-in-focus.html

 

Save your pennies and buy up the discards of those who are panic selling. Classic time to wait for the moment to buy into what is otherwise an expensive market.

 

I don't know how closely you follow global markets but countries like Russia and Japan have failed to stimulate any growth. The U.S. has been the only market that's been strong. Right now, the super rich can take advantage of the dip in the market. It's the top 1% that are making all the choices. Interest rates are at the lowest that we've ever seen, yet many countries are broke. They borrowed money cheaply and can't repay those loans.

There's mass protests that have broken out in countries from Lebanon to Spain to Chile and Bolivia. All are different with distinct causes, but there are some common themes that connect them. Many of those protesting are people who feel that they have been shut out of the wealth of their country. It sometimes takes very little for people to take to the street in these countries such as a rise in prices for key services or goods.

 

ouch, could be an ugly day on the market, I gave up trying to time these things years ago so i'll just ride it out.

fingers crossed that my fund managers were thinking about this and took appropriate steps

 

Who are "they"?

That 10% number (currently at 9.4%) has been dropping every day. It is distorted by the relatively large number of deaths attributable to the lack of a proper response at the outset.

The predictions, that I've read in my local newspaper, are for a final mortality rate of 3% or less.

At the beginning of February, the mortality rate was something like 40%.

Scroll down to "CLOSED CASES" and click on "Show Graph":

https://www.worldometers.info/coronavirus/

 

Who is this "they"? Flu is also "transferable merely through the air and is extremely contagious" and kills millions every year

 

Thanks for the link.

 

Unlike influenza, the coronavirus (now) appears to have a potential 27 day incubation period and you're contagious without showing symptoms. That is somewhat of a game changer.

Coronavirus incubation period could be 27 days, shows data

 

Have you noticed that over the last few months whenever the index went down the blame is put on the virus but whenever it went up no comment was made. The virus has been around for a few months and not much has changed over the last few weeks yet the index is still higher than it was 24 days ago. So yes, I agree with you that the market was due to fall anyway and the virus is being used to create fear

 

We should have listened to all those gold & silver commercials on Fox News.

 

Flu is the same. A huge majority of those that have died were already ill with other life threatening diseases or just as likely to die from flu. For example, the four that died in Italy were aged 80, 84, 88 and a cancer patient (don't know age)

 

It's the large number of new cases in Italy and South Korea that is spooking the market and the fact that world wide trade is now at a virtual standstill.

 

Having a part of your assets in precious metals is certainly a mainstream position rather than fiat currency backed by what?

 

It's mass hysteria. This is no worse than a really bad flu. People are acting like it's the Black Plague redux and I'm hoping the market crashes at which point I'll buy big time.

 

good time to buy

the supply chain will recover

 

Democrats are giddy about any negative bump in the economy they of course will completely ignore any cause and just find a way to blame it on Trump.
Obama would have immediately cured Coronavirus we all know that.

 

ROFL... Impeccable timing for me as at least 1 of my 401K's as I just cashed it out to roll it into an IRA.

 

There is a real problem with how you stated your remark..."We (i.e. The West) have allowed China to make nearly everything we purchase because of price point." Many Americans and Western Countries did not want manufacturing moved to any other countries
It was all Wall St. and large corporations and the rich! All they see and still see is $$$$. They will be able to survive this trouble and everything will be right back to where it is now.
They don't need to pay decent wages , provide health care for employees, pay workmen s compensation, paid vacation, child leave.....need I go on.
Wait.....that sounds just like Republican mantra!!
And as it was said before...."large corporations and the wealthy will survive," then it is back to business as usual.
So, don't say "WE" when it is the mantra of the republicans.

 

If your fund manager is timing the market, I'd consider dropping them. They may pretend that it is not the case, but they are no better at timing the market than you are. You'd be better off with the Bogle 3-fund portfolio anyway, much lower cost.

 

How do you know the market is not going to drop further tomorrow? It is well established that buying the dips is not a strategy that works in the long run. Better to just automate and DCA.

 

I cashed out when the market was near $30k. I'm merely rolling it into an IRA.