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Five Things to Know in World Business Today

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These translations are done via Google Translate

By Lorcan Roche Kelly
Feb 12, 2020

Xi says China will meet its economic goals, Sanders tightens hold on Democratic nomination, and Europe’s manufacturing slump worsens. Here are some of the things people in markets are talking about today.

Expressing optimism
President Xi Jinping said that China has the ability to accomplish its economic growth and social development goals, and will “defeat the epidemic.” Xi’s optimism is not shared by economists outside the country who have cut their growth forecasts as the effects from the outbreak are worse than first thought. The toll from the virus, now named COVID-19 by the World Health Organisation, continues to rise with latest figures showing more than 1,100 people have died and over 45,000 confirmed cases worldwide.

Sanders wins
Results from the New Hampshire primary showed Bernie Sanders leading by more than one percentage point over second place Pete Buttigieg. The strong performance by Amy Klobuchar, who finished third, was one of the big surprises of the night. Joe Biden finished fifth, with his campaign apparently in freefall. Tech entrepreneur Andrew Yang dropped out of the race.


Manufacturing in the euro area ended 2019 with the deepest slump in almost four years, with industrial production dropping 2.1% in December from a year earlier. Worryingly for policymakers, the dismal numbers came in the period ahead of the COVID-19 outbreak, which means any quick turnaround is unlikely. Those same fears are also starting to edge up for the U.S., with Bloomberg Economics’ recession prediction model showing an increase in the chances of a reversal in growth. They do, however, point to a raft of temporary factors, rather than anything structural in the forecast.

Markets rise
Virus fears and manufacturing slowdowns are not enough to derail the continuing good run for global equities. Overnight the MSCI Asia Pacific Index climbed 0.5% while Japan’s Topix index closed broadly unchanged. In Europe the Stoxx 600 Index was 0.4% higher at 5:50 a.m. Eastern Time with cyclical stocks posting the biggest gains. S&P 500 futures pointed to more green at the open and the 10-year Treasury yield was at 1.609%. Greece’s 10-year bond yield traded below 1% for the first time ever.

Coming up…
Federal Reserve Chairman Jerome Powell is in Congress for his second day of testimony. Philadelphia Fed President Patrick Harker is also due to talk on the economic outlook this morning. OPEC will publish its monthly market review that will be closely watched for forecasts of the drop in demand from China. The U.S. monthly budget statement for January is published at 2:00 p.m. Cisco Systems Inc. and CVS Health Corp. are among the companies reporting earnings.

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