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Good morning. David Meyer here in Berlin, filling in for Alan.

For a moment this morning, it looked like Europe’s markets might be bouncing back from yesterday’s coronavirus-sparked tumble. But no. At the time of writing, any early gains have been wiped out: Europe’s Stoxx 600 is down 0.9%, the U.K.’s FTSE 100 is down 0.8%, Germany’s DAX is down 1%, and Italy’s Borsa Italiana is down 1.3%.

At least it’s not as bad as in Japan, where the Nikkei 225 fell 3.3% in the wake of yesterday’s 3.4% drop in the S&P 500—though the Japanese market was closed for a holiday yesterday, so it’s just playing catch-up. The Shanghai Composite was also down 0.6% today, but the Hang Seng was up almost 0.3% and South Korea’s Kospi made a 1.2% recovery. As things stand, futures indicate a flat open in the U.S.

So what’s happening in Italy, where an enormous spike in infections over the weekend caused yesterday’s rout? The death toll is up to seven now, but the number of confirmed cases has tapered off—though at 229, it’s still the third-largest tally in the world, after China (77,658 cases, 2,663 deaths) and South Korea (977 cases, 10 deaths).

The British government has advised people who have visited northern Italy—the hub of that outbreak—to isolate themselves if they experience flu-like symptoms. The European Parliament is taking things a step further, telling all staff who have visited the region to self-isolate for a couple weeks, and to only return to the office following a doctor’s approval. Goldman Sachs is taking a similar approach, and Crédit Agricole has reportedly imposed a travel ban within Italy.

Compared with the restrictions imposed by authorities in China, the self-isolation advice appears to be a modest—perhaps even weak—response. Beijing’s approach has been so heavy-handed that it has triggered pushback from Chinese business leaders and economists, who argue Beijing has gone too far and will hurt livelihoods while failing to stem the Covid-19 outbreak. Then again, the outbreak is far worse in China than it is in Europe.

There is much to be said for avoiding panic in the Italian context, but there is also a strong need for leadership in the response to Covid-19, even if policymakers are flying blind here—as Fortune‘s Eamon Barrett writes today, the World Health Organization is not providing clear answers to the question of whether we’re facing a pandemic yet, even though a worldwide spread remains very possible.

Ultimately, only hindsight will allow us to evaluate whether the Chinese or European approach was the more effective. In the meantime, stay alert.

More news below.

David Meyer

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