- The Washington Times - Monday, February 24, 2020

The coronavirus from China infected Wall Street on Monday as U.S. stocks took a beating amid fears that the outbreak that hobbled the world’s No. 2 economy would carve through Europe and make South Korea’s economic engine seize up, too.

The Dow Jones Industrial Average plummeted 1,032 points, its biggest point drop in two years, while the S&P 500 and Nasdaq 100 slid more than 3%.

Airline and technology stocks were hit hard as travel restrictions and limits on China’s output begin to catch up to key sectors. Chipmakers and resort operators also slid, as did U.S. casino operators, some of which do business in Macao. The Chinese gambling mecca shut down for two weeks because of fears about the virus.

President Trump, who had been boasting about stock market records in an election year, said he isn’t worried, though he did request $2.5 billion from Congress late Monday to deal with the emerging threat.

“Stock Market starting to look very good to me!” he tweeted from India.

Yet markets in Europe and South Korea also struggled Monday, underscoring the global reach of the outbreak. Samsung Electronics fell 4%, two days after the company confirmed a coronavirus case at one of its phone factories.

The coronavirus causes a disease known as COVID-19, which can lead to severe respiratory distress and organ failure. It has killed nearly 2,600 people in China and nearly two dozen elsewhere.

Though centered in China’s Hubei province, the outbreak is grabbing a foothold in Italy and surging in Iran and South Korea, which has reported the most cases outside of China.

Italy locked down a cluster of towns in the northern region of Lombardy as its national case count rose to 230.

The Carnival of Venice ended early as the city shut down tourist attractions and public transportation. In Milan, Giorgio Armani closed his autumn-winter 2020 fashion show to spectators and opted to livestream models strutting down the runway. The 85-year-old emerged at the end of the spectacle to acknowledge a room that was empty except for his models.

South Korea has reported more than 800 cases of COVID-19, making it the worst-hit place besides the outbreak’s center in China.

Eight people in South Korea have died from the outbreak, centered in the southeastern city of Daegu, where 2.5 million people have been asked to stay indoors.

Japan has reported slightly more cases than its Korean neighbors, though many of those cases were tied to a formerly quarantined cruise ship.

Iran, meanwhile, has reported more than 60 cases. Eight people have died.

With Italy, “you’re in the heart of Europe,” said James Carafano, a homeland security analyst at The Heritage Foundation. “In Iran, you’re basically going to overrun parts of the Middle East that have poor health systems.”

No one has died of COVID-19 on U.S. soil, though officials said the case count rose to 53 Monday. Americans repatriated from the Diamond Princess cruise ship account for 36 of the infections. Three were flown home from Wuhan, China, on State Department flights.

Twelve of the remaining cases are people who traveled into the U.S. on their own and two who caught the virus from human-to-human transmission, according to the Centers for Disease Control and Prevention.

“The Coronavirus is very much under control in the USA. We are in contact with everyone and all relevant countries. CDC & World Health have been working hard and very smart,” Mr. Trump tweeted.

The top Senate Democrat slammed Mr. Trump’s efforts from the chamber floor Monday, citing the White House proposal to slash CDC funding in its annual budget.

“My fellow Americans, that’s what they do on all these things,” said Senate Minority Leader Charles E. Schumer, New York Democrat. “They just cut, and then the president tries to claim credit after we restore the money.”

Mr. Schumer also slammed Mr. Trump for dismantling the part of his National Security Council that deals with global health security. He said that has left the U.S. unprepared for local transmission.

He also panned Mr. Trump’s request for coronavirus funding, saying it was “too little, too late.”

He particularly objected to plans to shift $535 million in leftover Ebola funding, citing the ongoing outbreak in Congo.

Administration officials said they were being prudent in redirecting money from a fight that is winding down to one that is surging.

All told, the White House wants $1.25 billion in new funding, the Ebola money and a series of other transfers that add up to $2.5 billion.

“The Trump administration continues to take the spread of the COVID-19 coronavirus disease very seriously,” said Rachel Semmel, spokeswoman for the White House Office of Management and Budget. “Today, the administration is transmitting to Congress a $2.5 billion supplemental funding plan to accelerate vaccine development, support preparedness and response activities and to procure much-needed equipment and supplies.”

The Department of Health and Human Services has tapped into an emergency infectious disease rapid response fund and is seeking to transfer more than $130 million from other HHS accounts to combat the virus but is pushing for more, The Associated Press reported.

White House deputy press secretary Judd Deere said Americans’ risk “remains low because of the containment actions taken by this administration since the first of the year.”

“The global situation is serious and changing hourly, which is exactly why [HHS Secretary Alex Azar] continues to lead a whole-of-government response that includes the best experts on infectious diseases,” he said. “The president is receiving regular updates, and is prepared to take additional action to protect the public health.”

In the meantime, the swift spread of the virus has many wondering whether the disease is becoming a “pandemic” that puts much of the global population at risk.

World Health Organization Director-General Tedros Ghebreyesus said it hasn’t reached that point.

“For the moment, we are not witnessing the uncontained global spread of this virus, and we are not witnessing large-scale severe diseases or deaths,” he said. “Does this virus have pandemic potential? Absolutely, it has. Are we there yet? From our assessment, not yet.”

He described the situation as a series of epidemics that are affecting various countries in different ways, each requiring a tailored response.

“Using the word ‘pandemic’ now does not fit the facts, but it may certainly cause fear,” Mr. Tedros said. “This is not the time to focus on what word we use. That will not prevent a single infection today or save a single life today. This is a time for all countries, communities, families and individuals to focus on preparing.”

Still, Wall Street is starting to grapple with the fallout from the virus, which brought many parts of China to a standstill. China’s communist government imposed strict quarantine rules and told workers to delay their return from Lunar New Year travel.

China plays a pivotal role in the global supply chain, and its nearly 1.5 billion people serve as a major consumer market for global brands.

“The global spread of the disease, it’s starting to hit people’s pocketbooks,” Mr. Carafano said. “You take Chinese tourism off the plate, that’s not insignificant to a lot of countries.”

Shares of Apple Inc., which relies on Chinese manufacturing for its iPhone and had to close its Chinese stores or trim hours, closed down 4.75% on the Nasdaq composite.

Some companies’ stocks are rising. Zoom Video, which offers video conference software, is benefiting as employees work remotely amid the outbreak.

Shares of Clorox, which makes bleach and other cleaning products, also rose.

WHO said Monday that China has reported more than 77,300 cases and 2,600 deaths, though the 24-hour count of new cases was down to 460, continuing a general decrease in daily tallies.

“We are encouraged by the continued decline in cases in China,” Mr. Tedros said.

Cases in China appeared to peak and then plateau from Jan. 23 to Feb. 2 and have been declining steadily since then, said Mr. Tedros, citing the findings of a WHO team dispatched to Wuhan.

Mr. Tedros said the fatality rate from COVID-19 is 2% to 4% in Wuhan and 0.7% outside of Wuhan.

Patients with mild cases can recover within two weeks. Those with severe bouts need three to six weeks to recover.

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