February 24, 2020

Coronavirus fears hit Wall Street: Dow plunges 900+ points

Daily Briefing

    Stocks in the United States and abroad fell sharply Monday morning as the number of new coronavirus cases outside of mainland China surged—causing public health officials to worry the outbreak could be nearing pandemic status.

    Our analysis: The 'recurring themes' of disease outbreaks

    About the outbreak

    Reports of the new coronavirus first surfaced in early December 2019 in Wuhan, China. According to the World Health Organization (WHO), the main symptoms of infection from the virus, called COVID-19, are fever and lesions in both lungs. Some patients also have reported difficulty breathing, WHO said.

    As of Friday, officials reported more than 77,000 cases of the virus globally. Officials said as of Friday there have been about 2,350 reported deaths linked to the virus, according to STAT News. Most of those deaths occurred in mainland China.

    New coronavirus cases outside of China surge—and global economy takes a hit

    While the vast majority of the more than 77,000 cases occurred in mainland China, the number of cases being reported outside of mainland China are growing—and it's causing markets, both overseas and in the United States, to fall, CNBC reports.

    In the United States, CDC as of Monday reported a total of 53 confirmed cases of COVID-19, including 39 who'd been traveling or living outside the United States and were repatriated to the country and tested for the virus by CDC.

    Officials in South Korea reported 204 cases of the virus on Monday, up from 30 reported cases on Friday. In Italy, officials had reported no cases of the virus as of Friday morning but confirmed more than 150 cases as of Sunday—prompting the country to quarantine 11 towns.

    Experts also noted that Iran had reported no cases of the virus at the start of last week, but reported 43 confirmed cases—including eight deaths—as of Sunday. Further, one patient in Canada and one in Lebanon who had traveled to Iran tested positive for the virus after returning to the countries.

    The increase in cases outside of China were followed by sharp declines in the global stock market, prompting new concerns that the outbreak could cause a lengthy economic slowdown throughout the world, CNBC reports.

    For instance, in the United States, the Dow on Monday opened down nearly 3%, or 833 points, and was down 3.3%, or 962 points, by midday. The Standard & Poor's 500 index was down 2.8%, and Nasdaq was down more than 3%, CNBC reports. Indexes in Europe and China experienced similar losses, the Post reports. For example, the European Stoxx 600 was down more than 3%, Korea's Kospi index was down 3.9%, and Hong Kong's Hang Seng index was down 1.8%.

    Investor Warren Buffett said although the coronavirus outbreak has negatively affected the U.S. economy to some extent, it's still in relatively good shape. "Business is down but it's down from a very good level," he said.

    Officials warn outbreak is nearing pandemic status

    Meanwhile, experts and WHO officials are concerned that the coronavirus outbreak is nearing pandemic status, STAT News reports.

    Marion Koopmans, a virologist at WHO, said the virus outbreak "is rapidly becoming the first true pandemic challenge that fits the disease X category, listed to the WHO's priority list of diseases for which we need to prepare in our current globalized society."

    Michael Osterholm, director of the University of Minnesota's Center for Infectious Diseases Research and Policy, said, "I think people are missing the importance of a case like the Canadian traveler to Iran." He added, "This tells us that there has to be a much larger number of people infected in Iran and we're literally just detecting the tip of the iceberg."

    Osterholm said the virus could be more widespread than reported in other countries, as well, because narrow testing protocols in some countries might mean there are patients with the virus who haven't been screened. For example, in the United States, CDC recommends testing patients for the virus only if they are exhibiting symptoms and have traveled to China or been in contact with a person who had a confirmed or suspected case. "Basically if you get tested and you're found and you're positive, then we know," Osterholm said, adding, "But how many people right now are not being tested who are just like this case in Canada?"

    Experts also noted that the latest cases raise questions about how the virus is spreading. For instance, Margaret Harris, a spokesperson for WHO, said "it's not clear how the virus is spreading" because countries are beginning to report cases of the virus "that don't have a clear epidemiological link." This means patients who have not traveled to China or been in contact with someone who has traveled to China or has had a confirmed or suspected case of COVID-19 are now contracting the virus.

    CDC says US communities should get ready for possible 'sustained spread' of new coronavirus

    Nancy Messonnier, director of CDC's National Center for Immunization and Respiratory Diseases, on Friday said the agency might expand its recommendations for testing patients for the new coronavirus if the virus continues to spread outside of China.

    In the meantime, she urged U.S. communities to prepare for new cases of the virus and the potential for the virus' "sustained spread" in the United States. Messonnier also cautioned that "[t]he day may come" when the United States needs to implement containment measures similar to those being implemented in China, such as closing schools and businesses.

    "We're not seeing community spread here in the United States, yet, but it's very possible, even likely, that it may eventually happen," she said. "Our goal continues to be slowing the introduction of the virus into the U.S. This buys us more time to prepare communities for more cases and possibly sustained spread."

    Messonnier said CDC is coordinating with local and state health departments "to ready our public health workforce to respond to local cases and the possibility this outbreak could become a pandemic." In addition, CDC is working with hospitals, pharmacies, and health care manufactures and supply chain partners to assess what medical supplies the country would need to address an outbreak in the United States (Lovelace/Feuer, CNBC, 2/21; Branswell, STAT News, 2/21; CDC website, 2/21; Johnson et al., Washington Post, 2/22; Purnell, Wall Street Journal, 2/24; Blanchard, Daily Mail, 2/24; Imbert/Huang, CNBC, 2/24; Siegel/Heath, Washington Post, 2/24).

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