 The Express | Insight Before the Bell
By Caleb Silver, Editor in Chief & Deborah D'Souza, News Editor Thursday's Headlines 1. Global markets slide on new coronavirus cases  Markets Today Global markets are giving up gains from earlier in the week as investors shun risk assets amid concerns about an increasing number of coronavirus cases. China health officials said there have been 15,152 new cases and 254 additional deaths. Those figures include the ones reported earlier by Hubei province under a new diagnosis methodology. That brings the country's total death toll to 1,367 as the number of people infected jumped to nearly 60,000, according to the Chinese government.
The spread of the virus is also crimping companies' abilities to forecast sales for this quarter and the full year, which is impacting economic forecasts around the world. The European Union maintained its outlook for subdued but stable growth through 2021 of 1.2%, but warned that the coronavirus could derail that forecast. "The baseline assumption is that the outbreak peaks in the first quarter, with relatively limited global spillovers. The longer it lasts, however, the higher the likelihood of knock-on effects on economic sentiment and global financing conditions," the European Commission said in its forecast.
Proceed with caution on this Thursday.
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 Image courtesy: xponentialdesign/Giphy The Big Story Demand Shock A day after the OPEC cut its global oil demand growth forecast, the International Energy Agency (IEA) has predicted the first quarterly contraction in demand in over a decade in Q1 2020.
According to the latest IEA Oil Market Report (OMR), the Covid-19 outbreak and widespread shutdown of China's economy will cause global oil demand demand in the quarter to fall by 435 kb/d y-o-y. The organization has lowered its 2020 growth forecast by 365 kb/d to 825 kb/d, the lowest since 2011. Global refinery runs are now expected to see a smaller expansion of 0.7 mb/d in 2020.
IEA cautioned against using the SARS epidemic of 2003 as a reference point for analysis since China's place in the global economy has changed drastically since then and its demand for oil more than doubled by 2019. Last year, the country's demand reached 13.7 mb/d (14% of the global total) and it accounted for more than three-quarters of global oil demand growth. Shutdowns in China, therefore, have a much larger impact on oil demand and prices today than they used to. IHS Markit expects the country will need to slash its crude imports by as much as 900,000 b/d on average over the course of the next four months in order to bring its crude supply and demand back to balance.
"From the point of view of the producers, before the Covid-19 crisis the market was expected to move towards balance in the second half of 2020 due to a combination of the production cuts implemented at the start of the year, stronger demand and a tailing off of non-OPEC supply growth," said IEA. "Now, the risk posed by the Covid-19 crisis has prompted the OPEC+ countries to consider an additional cut to oil production of 0.6 mb/d as an emergency measure on top of the 1.7 mb/d already pledged. Lower oil prices, if sustained, are also bad news for highly responsive U.S. oil companies, but we are unlikely to see an impact on output growth until later in the year."  Image courtesy: IHS Markit  Big Number: $27.4 billion That's the total amount Americans will spend on Valentine's Day this year, according to an annual survey by the National Retail Federation (NRF) and Prosper Insights & Analytics. This figure has (heart-shaped) ballooned 32% from last year's record $20.7 billion. Those celebrating the holiday will spend an average of $196.31, up 21% from 2019. The NRF said this year's "unusually large increase" in spending is due to strong consumer finances and a continued trend of consumers buying more gifts, cards, candy and flowers for friends, family, co-workers and even pets (see chart below).
Significant others now account for only 52% of total spending, down from 61% a decade ago. Twenty-seven percent of respondents said they will buy gifts for their pets, the highest figure in the history of the survey and up from 17% in 2010 for a total $1.7 billion. (FYI there's usually a spike in accidental pet poisoning cases every Feb. 14. The ASPCA has a list of safety tips.)  Image courtesy: NRF More coverage:
/shutterstock_121524487_cyber_security_pad_lock-Copy2-Copy-Copy-Copy-db87afddfcb44e2fa01e5e977610490b.jpg) 3 Charts Suggest Cybersecurity Stocks Are Headed Higher Bullish chart patterns and strong underlying demand suggest that cybersecurity could be the sector to watch for the rest of 2020.
/shopify-790e51ee4dab4175ab8d983a6b3b1731.jpg) Shopify Stock Rockets to All-Time High After Earnings Shopify blew through fourth quarter top- and bottom-line estimates, lifting the stock to an all-time high above $550.
/shutterstock_380975137_brazil_economy-56fff5820c654821ab7ea603bf6dda26.jpg) Brazil ETFs Trade at Trendline Support A recent retracement in Brazilian stocks provides a "buy the dip" opportunity. Trade the country's stocks using these three ETFs.
 Two Investopedia Top 100 Advisors Launch New Firm Co-founded by Lazetta Braxton and Rianka Dorsainvil, 2050 Wealth Partners aims to help clients design the lifestyles and legacies they want.
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Thursday, February 13, 2020
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