Futures tied to the Dow Jones inched up 0.3%. the Stoxx Europe 600 moved up 0.1%, while Hong Kong's Hang Seng Index ended the day 1.3% higher.

Investors are assessing the risk that the coronavirus identified in China poses to international business. The virus has claimed a ninth victim and a first case has been identified in Seattle in the United States: a man who stayed in Wuhan, the city where the first patient was diagnosed in December. About 440 people were treated in China and a few others in several Asian states. The authorities are working to limit the spread, which means tighter controls at airports and restrictions on some travel. WHO is holding a special meeting later tody to review the situation.

Stock exchange reactions are fairly straightforward: risk aversion is rising towards shares related to tourism (airlines, accommodation) and consumption dependent on passenger flows (typically luxury goods). However, previous experiences have shown that these corrections tend to wear off within a fairly short period of time. If and only if, of course, the health authorities demonstrate that they are capable of curbing the crisis.

Meanwhile, the landmark Donald Trump trial began yesterday in the US Senate. The outcome is already known as the Republican majority continues to stand united and remains determined to acquit its President. Republican Majority Leader Mitch McConnell envisioned a speedy trial, as desired by the White House. However, he was forced to change his plans because some elected officials were reluctant to do so.  A few senators were able to convince McConnell that a little more time was needed. Each side will then have 24 hours to present its arguments, spread over three days (instead of two).

A few news from Davos, where Steve Mnuchin disagrees with the IMF. On the sidelines of the summit, the US Treasury Secretary criticized the IMF's growth forecasts for the United States. According to him, it is "too low". He nevertheless acknowledged that the crisis involving Boeing's 737 Max was weighing on the economy. As a reminder, the international institution has revised its growth estimates for the United States downwards for the year 2020 (2% as against 2.1% previously).

 

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