Topline: Italy has imposed quarantine and travel restrictions on 50,000
in its northern economic heartland while investors sold shares and bought
safe-haven assets over fears that the coronavirus could become a pandemic.
·
At least four people
have died from Covid-19 in Italy’s Lombardy region, where Italy’s financial
capital Milan is located, while 152 people are thought to be infected.
·
50,000 people are now
on lockdown across 12 towns in the Lombardy and Veneto regions in the north, meaning
people cannot leave or enter, while schools and universities in the region are
closed for the week.
·
Stella Kyriakides, EU
health commissioner, said on Monday: “For the moment WHO has not advised
imposing restrictions on either travel or trade.”
·
Austria will on Monday
discuss whether to completely close its border with Italy after suspending rail
services on Sunday.
·
In a bid to contain
the virus the Venice Carnival was cut short, several Serie A football games
were cancelled, while at Milan Fashion Week Giorgio Armani’s fashion show
played to an empty room.
·
Markets in Europe slid
on Monday, with Italy’s FTSE MIB falling more than 4%, while London’s FTSE 100
was down 3.3% on Monday morning. Investors flocking to the safe-have assets
have pushed gold to its highest price in around seven years.
·
South Korea on Monday
announced 70 new cases of the virus, bringing the total number of cases to 833,
as the Kospi index slumped 3.8%
·
In China, residents of
Wuhan, the city at the centre of the outbreak, have now spent a month under
lockdown with an announcement from the city government that non-residents would
be allowed to leave today was quickly retracted.
Key background: News that the coronavirus has now infected
over 79,000 people globally with new clusters of the virus emerging in Italy,
South Korea, and Iran have tested the confidence of global investors.
Travel, airlines and luxury stocks were
particularly hard hit by Monday's sell off with Italy, the world's eight
largest economy, and South Korea, the 12th largest, announcing tough measures
in an attempt to control the spread of the virus.
The coronavirus could present a major test to
the world's economy even if its spread can be contained. Supply chains that
depended on China have been tested by the prolonged Lunar New Year holiday, and
travel restrictions while the Chinese Association of Small and Medium
Enterprises reports 60% of surveyed firms faced a cash crunch in the next two
months.
Meanwhile, there are also concerns that Iran
is a major hub for the disease in the Middle East, with at least five people
dead, while Turkey, Pakistan and Armenia have closed their borders with Iran,
Aljazeera reports.
Tangent: The World Health Organization says it no longer uses the terms
‘pandemic’, but instead uses the phrase ‘public health emergency of international
concern’ to indicate the seriousness of the illness and trigger an
international response to help tackle it.
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