Here's our summary of key economic events overnight that affect New Zealand, with news equity markets have finally realised that the Covid-19 virus threat will cause very major problems for investor returns.
But first, the pace of home price growth in the American market sped up in December from earlier months, marking a full eight years of price increases in American homes for sale. Average home prices in major metropolitan areas rose +3.8% in the year ended in December, although that was down from the +4.5% growth in 2018.
And the widely watched Conference Board sentiment survey edged up in February, suggesting American consumers are oblivious to the risks ahead, and expecting the pace of consumer spending that could support their economy - even if Wall Street now doesn't believe it will.
The Richmond Fed factory survey in the American mid-Atlantic states wasn't so positive, reporting a sharp fall in activity in February.
The latest compilation of Covid-19 data is here. There are now 2690 cases outside China and in places like Iran that is probably way under-reported. A week ago that number was 1463 so it has about doubled in one week.
In Hong Kong, schools will remain closed due to the Covid-19 virus outbreak until April 20.
And staying in Hong Kong, the depressed economy is devastating their housing market. The expectations are now that large numbers of homeowners will be in negative equity situations. It is likely to be similar in many mainland Chinese cities also, although news about that is absent from China.
Some investors see opportunity in a crisis. China's margin trading is picking up as investors rush into the stock market on expectation that Chinese government will step up stimulus measures to support the economy hit by the coronavirus outbreak.
Wall Street is adding to yesterday's sharp losses today, down another -1.6% in midday trade. Update: That drop is now -2.4% in mid-afternoon trade, and sinking. That has wiped out all of their 2020 gains. Overnight European markets fell almost -2%. Yesterday, Tokyo fell -3.3% although some of that was a holiday catchup. Shanghai fell -0.6% but Kong Kong managed a small +0.3% bounce-back.
The IEA reported that CO2 emissions were unexpectedly flat in 2019 despite world economic growth of +2.9%. Increased emissions by developing countries were offset by reduced emissions by developed nations. Developing nations now emit double the carbon emissions that developed nations do.
The UST 10yr yield is lower again, now just on 1.32% and lower by another -4 bps overnight. Actually, that is a record, all-time low, even lower than in the GFC. Their 2-10 curve is less positive at +12 bps. And their 1-5 curve is more negative at -17 bps. and their 3m-10yr curve has also shifted more negative at -25 bps. The Aussie Govt 10yr is unchanged at 0.89%. The China Govt 10yr now at 2.87% and down another -1 bp. The NZ Govt 10 yr is at 1.21% and that is also a -1 bp overnight fall.
Gold has reversed course today, down -US$26 to US$1,647/oz.
US oil prices are staying lower at just under US$50.50/bbl. The Brent benchmark is also lower at just under US$55.50/bbl. It is all driven by demand fears.
The Kiwi dollar starts today lower at 63.2 USc, adding to last week's fall. On the cross rates we are little-changed at 95.9 AUc. Against the euro we are down to 58.2 euro cents. That means our TWI-5 has dropped to 69.2.
Bitcoin is now at US$9,325 which is a -5.7% fall since this time yesterday and a -8.5% dump in a week. The bitcoin rate is charted in the exchange rate set below.
The easiest place to stay up with event risk today is by following our Economic Calendar here ».