Today the world awoke to 5.1 million cases of the coronavirus. The number of new Covid-19 cases continues to grow in the world’s most affected country, the United States, where the total number of infections is approaching 1.6 million, and the death toll is close to 100,000. As more and more states try to reopen their economies we could see further increases in infections in the US.
Meanwhile, Russia now has over 317,000 Covid-19 patients and continues to report infection increases of around 10,000 per day. Brazil has become the third most affected country with just under 300,000 cases. The virus is also spreading wildly in Mexico, India, Pakistan, and Bangladesh at the moment.
The markets are becoming excited about the possibility of a new vaccine again as the United States government announced it will aid the British pharmaceutical company AstraZeneca financially by providing $1.2 billion to fund the development of its Covid-19 vaccine. The experimental drug is still to be tested in the United Kingdom this fall. If the first stage of testing is successful, the US will also host a large-scale clinical trial of it.
Speaking of the United States, President Trump is continuing his verbal spat with China, taking to Twitter to decry its handling of the coronavirus pandemic. This kind of aggressive rhetoric from Donald Trump is bad for the financial markets because it increases the fear of a renewed trade war between the world’s two largest economies.
Stock indices, in particular, respond quite negatively to trade war-related news and are all on the downside today.
Later today we expect this week’s initial jobless claims data from the United States. Though we are seeing a decrease week by week, the previous report was higher than expected, raising the alarm that the US will face worse unemployment than previously anticipated. Today’s numbers will be quite important in that context. Close to 25 million people have lost their jobs since the pandemic began in the US.
