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· CORONAVIRUS OUTBREAK

- China’s death toll exceeds 1,000, Royal Caribbean eases restrictions

The death toll in mainland China topped 1,011, according to Chinese state media. One death each has been reported Hong Kong and the Philippines. The number of infections in mainland China reached almost 42,300, bringing the total number of cases across the world to more than 42,700 as of Monday night.

- Global death toll passes 1,000

The Hubei health authority reported that 103 more people died of the coronavirus in Hubei province on Monday, raising the death toll in the epidemic's epicenter to 974.

This brings the total number of deaths in mainland China to at least 1,011. Globally, a total of 1,013 people have died, including one death in Hong Kong and one in the Philippines.

Hubei authorities confirmed an additional 2,097 cases of the virus in Hubei on Monday, which brings the total number of cases in the region to 31,728.

More than 25,000 patients have been hospitalized in Hubei, including 1,298 who are in critical condition, according to the health authority. More than two thousand patients have been cured and discharged.

The global number of confirmed coronavirus cases now exceeds 42,500. The vast majority of cases remains in mainland China.

China’s National Health Commission is expected to release numbers for all of China’s provinces later.

- China says 27 foreigners in the country have been infected with coronavirus, 2 dead

China’s Foreign Ministry said that 27 foreigners in the country have been confirmed infected with the new coronavirus as of Monday morning, and two had died.

An American died on Feb. 6 and a Japanese died on Feb. 8, ministry spokesman Geng Shuang told a daily news briefing in Beijing.

Three of the cases have been discharged, he added.

- Coronavirus is a ‘black swan’ for oil and energy markets

The coronavirus is a “true black swan” for the oil and energy market, and as crude prices continue to move lower the worst may not be over yet, Ned David Research said in a note to clients. Analyst Warren Pies noted that the outbreak has reduced Chinese demand for oil by 2 million to 3 million barrels per day, which means “the oil market is looking down the barrel at no demand growth for the calendar year, and outright demand contraction is now on the table.”

- Morgan Stanley analysts said in a research note that the disruption to supply chains due to the outbreak is seen as a “major concern for the global economy due to the integrated supply chains, especially in Asia.” Both China and the world economy are set to be affected in February and March, they said.

Many factories in China suspended operations as part of the country’s efforts to temper the spread of the coronavirus. Reports suggest those factories may remain closed for longer than expected

- Scientists worry coronavirus could evolve into something worse than flu, says quarantined expert

The seasonal flu has killed more people than the coronavirus, but that is not why the outbreak is so concerning, infectious disease expert Ian Lipkin told CNBC on Monday.

“It’s a new virus. We don’t know much about it, and therefore we’re all concerned to make certain it doesn’t evolve into something even worse,” said Lipkin, speaking from his New York home on a 14-day self-quarantine after traveling to China to work on the outbreak.

Lipkin, the director of the Center for Infection and Immunity at Columbia University’s Mailman School of Public Health, was in Guangzhou and Beijing, where he advised local health officials. He said he did not travel to the city where the coronavirus emerged, Wuhan in central China, because it would have been more difficult to return to the U.S.

“We don’t know much about its transmissibility. We don’t necessarily have accurate diagnostic tests. And we don’t really know where the outbreak is going to go,” Lipkin said on CNBC’s “The Exchange.”

“The only thing we have at present, absent vaccines or drugs, is containment,” he added.

- First-quarter US GDP may be as low as 1.2% due to coronavirus


Concern about the coronavirus is weighing heavily on the outlook for first-quarter growth and some forecasters suggest the equity market is not taking the threat as seriously as the bond market.

A CNBC survey of 11 forecasters over the weekend finds first-quarter GDP estimates averaging just 1.2%, down nearly a point from the fourth quarter. Economists see a bounce back to 2% growth in the second quarter, depending on the severity of the virus both in China and in other countries.

First-quarter forecasts range from a low of 0.4% from UBS to a high of 2% for Action Economics.

- China's first-quarter smartphone sales may halve due to coronavirus: analysts

China’s smartphone sales may plunge by as much as 50% in the first quarter, as many retail shops have closed for an extended period and production has yet to fully resume due to the fast spread of a new coronavirus, according to research reports.


· Federal Reserve Chairman Powell Testifies before Congress Preview: Pleased but wary

Items for note in Chairman Powell’s testimony

The January FOMC statement and the Monetary Policy Report described US economic growth as “moderate.” A stronger characterization by the Chairman will redound to equities and the dollar.

Mr. Powell will be circumspect on the corona virus but more questioning could excite the safe-haven trade to the dollar.

Positive comment on the economic potential of the US-China trade pact will play to the US and the dollar

Legislators will likely question the Chairman on the recent turmoil in the short-term funding markets and the steps the Fed has taken promote calm



· Dollar at 4-month highs against euro on virus concerns, economic outlook

The dollar hit a four-month high against the euro on Monday as concerns about the coronavirus boosted demand for safe havens, while a bullish outlook for the U.S. economy and weak data in the eurozone made the greenback relatively more attractive than the single currency.

Investors are concerned that the spreading virus will dent the global economic outlook.

Relatively strong economic data in the United States is also making the greenback more attractive than other currencies. Data on Friday showed that U.S. job growth accelerated in January.

Data on Monday also revealed that Italian industrial output was much weaker than expected in December.

We had much stronger than expected U.S. data, coupled with much weaker than expected eurozone data, said Win Thin, global head of currency strategy at Brown Brothers Harriman in New York.

Political uncertainty in Germany is an additional headwind for the euro. Annegret Kramp-Karrenbauer, leader of Chancellor Angela Merkel’s Christian Democrats (CDU), on Monday confirmed she would not run for chancellor in next year’s federal election but added that she would remain party chair until another candidate is found.

The euro fell to a four-month low of $1.0925. The British pound dropped to a two-month low of $1.2870 before rebounding to $1.2938.

The U.S. dollar index, which tracks the greenback against a basket of its peers, was last at 98.856 after seeing earlier lows around 98.6.



· Euro zone investor morale falls in February on coronavirus fears: Sentix

Investor morale in the euro zone fell for the first time in four months in February over fears that China will not be able to contain the coronavirus outbreak, a survey showed on Monday.

Sentix’s index for the euro zone fell to 5.2 from 7.6 in January. The Reuters consensus forecast was for a fall to 4.1.

The slight drop reflects the fact that investors think the economic damage from the novel virus has been mostly limited to China, said Sentix chief Manfred Huebner, adding that the global economy was getting impetus from the United States.



· Oil drops 1.5% to 13-month low as weak Chinese demand weighs

Oil prices fell to their lowest level since January 2019 on Monday on weaker Chinese demand in the wake of the coronavirus outbreak and as traders waited to see if Russia would join other producers in seeking further output cuts.

Oil has dropped more than 20% from a peak in January after the spreading virus hit demand in the world’s largest oil importer and fueled concerns of excess supplies.

Brent crude slipped $1.14, or 2%, to $53.33 per barrel, while U.S. West Texas Intermediate fell 75 cents, or 1.5%, to settle at $49.57 per barrel, its lowest settle since Jan. 7, 2019.

That keeps both Brent and WTI in oversold territory for 13 days and 14 days, respectively, their longest bearish streaks since Nov. 2018.

The premium of the Brent front-month over the same WTI contract, meanwhile, fell to its lowest since August 2019 in intraday trade.



Reference: CNBC, Reuters, FXStreet, CNN