From IFR news
Perhaps the news infecting equities the most, incubation periods, and Chinese authorities extended the Lunar New Year holiday to February 2, from January 30. And authorities are likely to push the holiday out further, resulting in more days of less consumption. Really in reverse since the holiday spending would have likely been a record. As we pointed out last week, the incubation period is dramatically longer than SARS was, up to 14 days, versus SARS typically just 2 to 3 days.
China’s Minister of health Ma Xiaowei said “This is very different from SARS…the virus can be contagious during the incubation period, which is about 10 days, with the shortest being one day and longest being 14 days”. Thus markets anticipate that the number of cases and deaths could continue to increase exponentially. And the growth decay also spreads. For example, Thailand’s tourism is often fueled by as much as 50% Chinese tourists. For now, tourism busts are going global.( italics my own)
I just want to repeat it is worries about the Impact on Global growth that has markets worried at least for now. WSJ article talking about past health scares and market impact, this in regards to SARS epidemic” the SPX posted a gain of almost 20% 12 months after first occurrence of SARS epidemic” a bit of panic now but hopefully brighter skies ahead for Stocks.
This is the busiest week in earnings season as some of the Big Tech companies report Apple,Amzn Microsoft and close to 125 SPX companies post results. FED meeting,Advanced GDP and Bank Of England policy meeting are also highlights this week ,Plenty on the Calendar to keep traders busy. Vix having a nice pop today as front month futures move above the second month ,providing another kink in the vix curve.
A few charts