If you want to talk efficiency; China built a 645,000 square foot hospital in less than 10 days. The 1,000 bed facility specifically built to house Coronavirus patients opened its doors Monday. Construction crews worked around the clock shifts to erect the structure, and a second facility is set to open in the next few days. Both are expected to fill up quickly.
As impressive a feat as that is, do you think it makes up for the fact that the Chinese government went to such great lengths to hide the outbreak from news outlets?
They Did What?
Reports confirm that when doctors in Wuhan province first became aware of a potential outbreak, they immediately began trying to warn people, and were quickly imprisoned in an effort to stop the flow of ‘misinformation’. The World Health Organization (WHO), which recently declared the virus a global health emergency, has praised China’s handling of the situation, but many others are calling the communist led government out over human rights violations for not informing the public sooner.
Basically, the consensus seems to be that the Chinese government knew how bad it was, and they went to great lengths to try and cover it up. Too many infected people were allowed to slip through the cracks, and now the rest of the world is at risk. Chinese officials have denied this, and accused the U.S. of causing panic and spreading fear.
The Market Reaction
So, what does this mean for stocks? Well, the Shanghai composite fell 7.7% Sunday night, and the Yuan dropped 1.6% against the U.S. dollar. It’s been reported that this is the worst day for markets in China since ‘Black Monday’ back in August of 2015, when an economic growth scare caused global markets to tumble.
After Friday’s selloff, U.S. stock index futures markets have been slow to respond to the price action in China. Initial expectations were for more panic selling early Monday, but we didn’t get that. It was actually quite the opposite. Stocks were strong after the open on the heels of better than expected ISM data, and also in anticipation of strong earnings from Alphabet Inc (GOOGL).
We’ll Take Some Good News
Though the death rate is still fairly low, looking at it from a percentage standpoint, the spread appears to be overwhelming. Travel bans have helped to slow the spread, but more cases in new countries are being reported every day. The death toll has topped that of the SARS outbreak back in 2003, when nearly 350 people died on mainland China, and the first reported death outside of China has been confirmed in the Philippines, which is a very big deal.
It’s not all bad news though, some optimistic stats have started coming out. China’s Health Commission stated Sunday that there have been around 475 confirmed cases of recovery, slowly starting to outpace the death toll, which currently stands at 361.
There is no preventative vaccine currently available to combat the virus, but doctors in Thailand are seeing positive results using anti-flu and anti-HIV medication treatments, and seeing recovery stats outpace death stats is definitely a refreshing bit of good news. There are still only 11 confirmed cases in the U.S. right now, but just the same, remember to wash your hands and keep them away from your eyes, nose and mouth.
Experts and pundits are saying it’s going to get worse before it gets better. We were saying that last week, and it’s coming to fruition.