American Capital Group: Where does the new crown epidemic shake the market?

American Capital Group: Where does the new crown epidemic shake the market?
Source: The United States Capital Group, which has assets under management of the Associated Press of more than US $ 1 trillion, recently released a report that the transformation into new coronaviruses has spread globally and has brought various degrees of impact to various economies.The report pointed out that the supply chain disruption caused by the epidemic situation may take longer to recover, and China’s economic recovery will be relatively long.  As new coronary pneumonia rages across the globe and spreads to countries such as Italy, South Korea, and Iran, global stock markets have plummeted this week, prompting investors to start thinking about how the sudden outbreak will affect global economic growth and the supply chain’s dependence on China’s corporate sector.In particular, the number of confirmed cases in Europe is increasing, and market reassessments are being performed to prevent global pandemics.  Prior to this Monday, emerging market stocks were hit the hardest, falling more than 5% from January 17 to February 21.Below that level, European stock markets have fallen by only about 1%.But subsequent selling pressure shifted to European and American markets.  Jody Jonsson, portfolio manager of American Capital Group, said: “In the short term, the market’s general view of the new coronavirus is still quite mild, but now it has spread beyond Asia, and investors are paying more attention.”The market is starting to think about what this means for global trade and tourism.The bond market is worried about recession in some regions, including China, Japan, and even Europe, and it is difficult to determine the economic impact on the United States.”The risk of supply chain disruption is underestimated. The report states that as part of the world’s second largest economy, the market is working hard to study the potential impact of the outbreak on the global supply chain and the corresponding impact on the economic activity of the merged company and other countries.”Stephen Green, an economist at American Capital Group, said:” I think the stock market has underestimated the risk of supply chain disruptions that are currently brewing.”Among them, Apple, which relies heavily on Chinese manufacturing plants, is the most prominent example of the previous widespread impact of the new coronavirus on global business.Apple Corps warned on February 17 that revenue for the quarter will exceed expectations.  The report also pointed out that given China ‘s quarantine measures and suspension of most economic activities, restrictions on the movement of goods pose a potential threat to Europe ‘s fragile industrial recovery, with Germany being the most threatened due to its close trade ties with China.In addition, the tourism, service and luxury goods industries in France and Italy also have great exposure to China.  ”The complexity and timing of the outbreak may make it more difficult and unpredictable to return to normal growth,” said Kent Chan, the group’s investment director.””, With the SARS period score, the current global supply chain is closer and more dependent on China. China’s share of global GDP is currently close to 20%.Based on the above reasons, American Capital Group believes that the impact of the epidemic may be more extensive than in the SARS period in 2003.  The impact of the New Crown epidemic on global investment indicates that the New Crown virus is causing damage to businesses around the world.Starbucks closed about half of its 4,300 stores in China.Many American airlines have cancelled flights to China.Some companies have lowered their profit forecasts for 2020, including some of the world’s largest cruise ship operators and consumer goods manufacturers.  Jonsson pointed out: “In some ways, the magnitude of the impact on certain companies outside China is easy to understand, and it can belong to this category.However, as more and more people stay at home, consumption of home entertainment and online shopping activities has increased dramatically.As a result, it has 深圳桑拿网 also boosted some industries, especially e-commerce and gaming companies.In addition, watch for changes in certain industries, such as luxury goods or related companies in the tourism industry.”