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U.S. Stocks Waver as Viral Outbreak Claims More Lives





U.S. Stocks Waver as Viral Outbreak Claims More Lives

  • U.S. stocks hovered around the flatline Monday as investors parsed signs about the path of the deadly coronavirus outbreak and how it might affect the global economy.
  • The death toll for the new virus climbed to more than 900 in mainland China, exceeding that of the severe acute respiratory syndrome, or SARS.
  • More than 40,000 people have contracted the virus, and the growth of new cases could accelerate further, the World Health Organization warned, even as officials across the world tried to quarantine people to contain the spread.
  • To contain the spread, China’s government had ordered lockdowns, cancelled flights and shut schools in many cities.
  • But on Monday, workers began trickling back to offices and factories though a large number of workplaces remain closed and many white-collar workers will continue to work from home.
  • Ireland’s main index fell as much as 1.2%, mainly dragged down by banks after Irish nationalist party Sinn Fein secured almost a quarter of first-preference votes in a weekend general election.
  • Later Monday, the White House will release its economic projections, including an updated growth forecast for President Trump’s final year in office, along with his proposed budget for the fiscal year.

Popeyes drives Restaurant Brands’ quarterly beat, Tim Hortons disappoints

  • Restaurant Brands International’s quarterly results beat market expectations on Monday, helped by the popularity of its fried chicken sandwiches at Popeyes, even as its breakfast chain Tim Hortons continued to struggle.
  • Total revenue rose 6.8% to $1.48 billion, beating estimates of $1.46 billion.
  • At Popeyes, same-store sales surged 34.4%, helped by the relaunch of a hugely popular fried chicken sandwich in November, which had earlier caused outright shortages at restaurants. Analysts were expecting a growth of 12.34% at the chain.
  • Comparable sales at Tim Hortons declined 4.3% in the reported quarter, falling below the estimate of a 2.44% drop.
  • Sales at established Burger King restaurants also fell below expectations.
  • Net income rose to $165 million in the fourth quarter, from $163 million a year earlier.

Top Apple iPhone maker Foxconn restarts key China plant with 10% of workers: source

  • Apple’s biggest iPhone maker Foxconn got approval to resume production at a key plant in China after being forced to shut it following the coronavirus outbreak, but only 10% of the factory’s workforce has managed to return so far, a source told Reuters.
  • Taiwan’s Foxconn, the world’s largest contract electronics maker, got the green light to restart production in the eastern central Chinese city of Zhengzhou, said the person with direct knowledge of the matter.
  • The company, however, has not yet been allowed to restart production in Shenzhen, a southern manufacturing hub.
  • The two factories together make up the bulk of Foxconn’s assembly lines for Apple’s iPhones, and the delays are likely to impact global shipments.
  • Market research firm Trendforce on Monday cut its March-quarter forecast for iPhone production by about 10% to 41 million handsets.

Tesla can get support for German factory: Economy Minister

  • Tesla could get state subsidies in its plan to set up a gigafactory in Germany, the country’s economy minister told a weekly newspaper.
  • The German government has earmarked financial support for making electric car battery cells locally as a way to secure manufacturing jobs as tougher emissions rules threaten demand for older technologies, like diesel engines.
  • Minsiter Peter Altmaier said in order to qualify for state subsidies companies needed to fulfill certain requirements in the areas of sustainability and battery efficiency.

Xerox Raises Offer for HP, Plans to Launch Takeover Bid in Early March

  • Xerox has raised its offer to buy HP to $24 a share and said it would launch a public takeover bid in early March.
  • The price comprises $18.40 in cash and 0.149 Xerox share for each HP share, Xerox said Monday.
  • The offer won’t be tied to financing or due-diligence conditions, it added.
  • The company said it has met with some of HP’s largest stockholders before increasing the bid.
  • It said it expects to launch its campaign to buy shares directly from investors on about March 2.

‘Parasite’ Makes History at the Oscars

  • The South Korean film “Parasite” won best picture at the 92nd Academy Awards, becoming the first ever non-English-language film to seize the top honor. The historic victory marked the fourth win of the night for the film, which mined suspense, humor and anguish in its tale rooted in the socioeconomic divide between two families.
  • The thriller beat the odds to win best picture over strong contenders, especially “1917,” a World War I drama directed by Sam Mendes which won three Oscars, for cinematography, sound mixing and visual effects.
  • Joker” went into the night with 11 nominations, more than any other film but came away with only two awards, including a win for lead actor Joaquin Phoenix.
  • Netflix scored with “American Factory,” which embedded with the workers and managers of a Chinese-owned factory in Ohio and won for best documentary.
  • With Laura Dern’s win for the Netflix release “Marriage Story,” the streamer converted only two of its 24 nominations into wins.


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Trump to Propose $4.8 Trillion Budget with Big Safety-Net Cuts

  • President Trump is expected to release a $4.8 trillion budget Monday that charts a path for a potential second term, proposing steep reductions in social-safety-net programs and foreign aid and higher outlays for defense and veterans.
  • The plan would increase military spending 0.3%, to $740.5 billion for fiscal year 2021, which begins Oct. 1, according to a senior administration official.
  • The proposal would lower nondefense spending by 5%, to $590 billion, below the level Congress and the president agreed to in a two-year budget deal last summer.
  • The White House proposes to cut spending by $4.4 trillion over a decade.
  • Of that, it targets $2 trillion in savings from mandatory spending programs, including $130 billion from changes to Medicare prescription-drug pricing, $292 billion from safety-net cuts—such as work requirements for Medicaid and food stamps—and $70 billion from tightening eligibility access to disability benefits.
  • The budget plan assumes the $1.5 trillion tax-cut package enacted in 2017, set to expire by 2025, is extended, and projects revenues in line with last year’s proposal.

Britain ‘reasonably confident’ of U.S. trade deal despite Huawei concerns

  • Britain takes U.S. concerns about its use of Huawei equipment seriously but is confident a trade deal with the United States will be among its first after leaving the European Union, its foreign secretary said on Monday.
  • U.S. officials have hinted future trade talks could be affected by Britain’s decision last month to grant Huawei a limited role in its 5G mobile network, frustrating a global bid by the United States to exclude the firm from the West’s next-generation communications systems.
  • Last month, Britain said it would cap at 35% the involvement of “high-risk vendors”, such as Huawei, in the non-sensitive parts of its 5G mobile network.
  • Britain is in talks with America, Australia, Canada, and others on future technological innovations that could challenge Huawei’s dominance in the field, Raab said.

Democrats Turn Combative to Gain Edge in Tight New Hampshire Primary

  • The Democratic presidential candidates blitzed the Granite State in a final bid to energize supporters and win over independent voters who could sway the outcome of Tuesday’s first-in-the-nation primary.
  • Sanders and Buttigieg are leading in a Boston Globe/WBZ-TV/Suffolk University poll of voters released over the weekend.
  • Mr. Sanders held at 24% and Mr. Buttigieg slipped by three points to 22%.
  • Sen. Elizabeth Warren polled at 13% and Mr. Biden at 10% in that survey, which had a margin of error of plus or minus 4.4 percentage points.

Sanders Campaign Seeks Iowa Re-Canvass After Buttigieg Wins More Delegates

  • The Iowa Democratic Party Sunday released updated results from its presidential caucuses last week that showed former Mayor Pete Buttigieg, was projected to win 14 delegates to July’s national convention, while Sen. Bernie Sanders will get 12.
  • Mr. Sanders had more support on both rounds of the overall voting, but the caucuses reward delegates based on widespread geographic support and not just total votes.
  • The Sanders campaign will submit a request for a partial re-canvass to the Iowa Democratic Party, senior adviser Jeff Weaver said Sunday.
  • Mr. Weaver wouldn’t rule out ultimately requesting a recount if the re-canvass didn’t go in-depth enough.

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Four Members of China’s Military Indicted for Massive Equifax Breach

  • Four members of China’s military have been indicted by the U.S. government on charges of hacking into the credit-reporting agency Equifax and plundering sensitive data on nearly 150 million Americans, the Justice Department said.
  • A federal grand jury in Atlanta returned a nine-count indictment last week that accused members of China’s People’s Liberation Army of conspiring to steal reams of data as part of a sophisticated hacking operation that exploited a major vulnerability in the software used by Equifax’s online dispute portal.
  • The breach into Equifax, disclosed in 2017, compromised data belonging to about 145 million Americans and has been viewed as one of the largest hacks on record.
  • It prompted prolonged public outrage and led to a series of hearings in Congress that led to the resignation of the company’s former chief executive, Richard Smith.

Coronavirus Helps Drive China’s Consumer Prices to Highest Level in Over Eight Years

  • China’s consumer inflation rose to its highest level in more than eight years in January as hundreds of millions of Chinese struggled to cope with a deadly coronavirus outbreak that has raised anxiety levels and pushed up the prices of many household goods.
  • China’s consumer-price index climbed 5.4% in January from a year earlier, the highest reading since October 2011, the National Bureau of Statistics said Monday. The key inflation reading was higher than December’s 4.5% rise and topped economists’ expectations.
  • Across the country, food prices in January rose 20.6% from a year earlier, accelerating from a 17.4% increase in December.
  • Pork prices surged 116% in January from a year earlier, versus a 97% increase in December.

Irish Stock Market Falls After Sinn Féin’s Election Victory

  • Irish stock markets dropped Monday after the general election delivered a strong showing for a left-wing party that campaigned on an increased state role in the economy.
  • The nationalist Sinn Féin party took 24.5% of the vote, beating the two parties that have traditionally dominated Irish politics, but failing to gain the 80 seats needed to have a majority.
  • The result provides little clarity on what a new government will look like, as Ireland’s other major parties have previously pledged not to join a coalition with Sinn Féin, which began as the political arm of the Irish Republican Army.
  • The inconclusive results introduce a fresh bout of political incertitude for Irish businesses, which have had to deal with protracted uncertainty around the U.K.’s exit from the European Union, of which Ireland is a member.
  • The U.K. is Ireland’s biggest trading partner.

Hundreds of Chinese firms seek billions in loans amid coronavirus outbreak – sources

  • More than 300 Chinese firms including Meituan Dianping, China’s largest food delivery company, and smartphone maker Xiaomi are seeking bank loans totaling at least 57.4 billion yuan ($8.2 billion) to soften the impact of the coronavirus, two banking sources said.
  • The firms, including China’s dominant ride hailing service provider, Didi Chuxing, Megvii Technology and Qihoo 360 Technology, were either involved in the control of the epidemic or had been hardest hit, the sources told Reuters on Monday.
  • The companies seeking loans in the Chinese capital are likely to get fast-track approvals and preferential rates, said the sources, who received copies of two lists of company names sent to banks in Beijing by the city government’s finance bureau.

Alibaba offers $2.86 billion in loans to firms hit by coronavirus outbreak

  • Alibaba said on Monday its affiliate Ant Financial MYBank unit would offer 20 billion yuan ($2.86 billion) in loans to companies in China in light of the coronavirus outbreak, with preferential terms for Hubei firms.
  • It said 10 billion yuan will be made available for firms in Hubei, the central Chinese province that is the epicentre of the outbreak.
  • They will be offered one-year loans on a zero interest rate basis for the first three months and a 20% discount on rates for the remaining nine months.
  • Firms across China can also get access to another 10 billion yuan of one-year loans, on which interest rates will be discounted by 20%, it added.

Nissan to halt production at Japan factory due to coronavirus

  • Nissan will temporarily halt production at its plant in Kyushu, southwestern Japan, due to the coronavirus, the Japanese automaker said on Monday, as the outbreak starts to strain the global supply chain.
  • In a statement, Nissan, the first automaker to halt production at a plant in Japan because of the outbreak, said that output would be affected on Friday and Feb. 17, due to supply shortages of parts from China.
  • The stoppage could impact production of around 3,000 vehicles, the Nikkei newspaper reported said, underlining the extent to which manufacturers in the world’s third-largest economy are reliant on China for supplies.

China 2019 fiscal spending up 8.1%, faster than economic growth

  • China’s fiscal spending climbed 8.1% in 2019 from the previous year, the finance ministry said on Monday, outpacing economic growth as policymakers sought to ward off a sharper slowdown.
  • Fiscal revenues increased an annual 3.8% last year, dragged by a 1.0% rise in tax receipts due to huge tax cuts, the finance ministry said a statement.
  • Fiscal expenditures were 23.89 trillion yuan in 2019, while revenues were 19.04 trillion yuan, the ministry said.
  • Tax and fee cuts exceeded 2.3 trillion yuan ($329.5 billion) in 2019, the ministry said, adding that it would continue to implement tax and fee reductions this year.

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  • The 25th Amendment was ratified, establishing presidential succession. (1967)
  • IBM’s computer, Deep Blue, beat the world chess champion, Garry Kasparov, in the first game of their match. (1996)

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