CDC Warns Travelers on Hong Kong; Two Die in Iran: Virus Update

(Bloomberg) — The International Monetary Fund reiterated that it sees a rebound in global growth this year, despite risks of a further spread of the coronavirus that has now killed 2,010 and infected 75,286 people around the world.

Iran said that two elderly patients died, the first fatalities, and the U.S. issued a travel watch for Hong Kong after a second patient died there.

China said it’s considering further measures to shield its economy from the outbreak, including cash infusions and bailouts for the struggling airline industry. The government is planning to take over HNA Group Co. and sell off its airline assets after the virus hampered the debt-loaded conglomerate’s ability to meet financial obligations.

As more people are encouraged to stay at home, a growing number of Chinese private companies have stopped paying staff completely.

Key Developments

  • Iran reports first deaths from coronavirus
  • China nears takeover of troubled HNA
  • Miners advance in bet on rebound in China metals demand
  • China death toll hits 2,004; 74,185 confirmed cases

Click VRUS on the terminal for news and data on the novel coronavirus and here for maps and charts. For analysis of the impact from Bloomberg Economics, click here.

CDC Warns Travelers (NYSE:TRV) to Hong Kong (4:20 p.m. NY)

The U.S. Centers for Disease Control and Prevention warned travelers to Hong Kong to be prepared for the novel coronavirus after a second person there died from the infection.

The agency put in place a level 1 travel notice for Hong Kong that advises visitors to avoid contact with sick people and to wash their hands often to avoid contracting the virus, which is spreading there from person-to-person.

The CDC has level 4 advisory for China’s Hubei province, the center of the outbreak, which means no one should travel there. The rest of mainland China is level 3, meaning people should avoid non-essential travel.

Two Iran Patients Die: Report (11:37 a.m. NY)

Two Iranian citizens who tested positive for the coronavirus have died, a Health Ministry official told the state-run Islamic Republic News Agency, the country’s first fatalities from the outbreak.

The patients were elderly residents of the the city of Qom, said the news agency, about 100 miles (150 kilometers) south of Tehran.

China Said to Near Takeover of HNA Group (9:45 a.m. NY)

China is planning to take over HNA Group Co. and sell off its airline assets after the coronavirus outbreak hit the indebted conglomerate’s ability to meet financial obligations, according to people familiar with the plans.

The government of Hainan, the southern island province where HNA is based, is in talks to take control of the conglomerate, which has been shedding assets after a global buying spree left it with one of the highest levels of corporate debt in China, the people said. The airline assets could be taken over later by other local companies, they said.

China’s Central Bank Expects ‘Limited’ Virus Impact (8:41 a.m. NY)

The People’s Bank of China acknowledged the downward pressure facing the economy and said the impact of the outbreak would be “short-lived” and “limited in terms of time and scope.”

It called for a “rational view” on the economic impact of the virus and said it’ll work to promote consumption and investment to boost domestic demand, according to a quarterly monetary policy report.

IMF Sees Global Economic Rebound Despite Virus Threat (8:30 a.m. NY)

Worldwide economic growth is expected to “moderately strengthen” this year, according to the IMF, despite the Washington-based lender warning that the coronavirus is one of the main risks that could derail that outlook.

Russia Exports to China Slump, Indonesia Spending Hit (6:24 a.m. NY)

Russia’s exports to China dropped by almost a third in the first six weeks of the year as the spread of coronavirus sapped demand in the world’s second-biggest economy. Separately, Indonesia’s revenue and spending fell in the first month of the year and the country’s finance minister warned of more risks to economic growth.

Macau Says 29 of 41 Casinos to Reopen Feb. 20 (5:32 p.m. HK)

Twelve casinos remain suspended. Reopening involves 1,800 gaming tables, which is less than 30% of the original number.

Adidas, Puma Say Coronavirus Pummeled Demand in China (5:02 p.m. HK)

Adidas AG (DE:ADSGN) and rival Puma SE said business in China was pummeled by the coronavirus, which forced the German sporting-gear companies to shut stores.

China Says Virus Spread Possible Via Aerosol in Confined Space (4:48 p.m. HK)

It is possible to catch the novel coronavirus if exposed to highly dense aerosols in a confined environment for a long time, China’s National Health Commission said.

Chinese Oil Refineries Deepen Run Cuts (4:09 p.m. HK)

Chinese refineries are throttling back production even further to cope with weak demand and a lack of workers due to the coronavirus, and are now processing 25% less oil than they were last year.

No Wages for Chinese Workers (2:50 p.m. HK)

A growing number of China’s private companies have cut wages, delayed paychecks or stopped paying staff completely, saying that the economic toll of the coronavirus has left them unable to cover their labor costs. To slow the spread of the virus, Chinese authorities and big employers have encouraged people to stay home. Shopping malls and restaurants are empty; amusement parks and theaters are closed; non-essential travel is all but forbidden.

Glovemaker Increases Debt Sale (12:54 p.m. HK)

The world’s biggest glovemaker got a vote of confidence from investors in the credit market, as the spreading coronavirus fuels demand for the Malaysian company’s rubber products. Top Glove Corp. sold 1.3 billion ringgit ($313 million) of Islamic notes, more than its planned offering of 1 billion ringgit.

All Negative for Westerdam Passengers (12:19 p.m. HK)

All remaining 781 passengers of the Westerdam cruise ship moored in Cambodia have tested negative for coronavirus. Holland America Line, which owns the vessel, made the announcement, citing the Cambodian Ministry of Health.

Japanese Efforts Criticized (12:15 p.m. HK)

As Japan began releasing passengers from a stricken cruise ship anchored off Yokohama, the U.S. Centers for Disease Control and Prevention criticized the Japanese government’s quarantine efforts, saying they may not have been sufficient to prevent transmission of the coronavirus aboard the vessel.

The CDC said in a statement Tuesday there may be additional virus cases among the remaining passengers, as the rate of new infections presents an “ongoing risk.” It said passengers and crew are prevented from returning to the U.S. for at least 14 days after leaving the ship.

APEC to Discuss Impact of Coronavirus (11:30 a.m. HK)

Senior officials of Asia-Pacific Economic Cooperation Secretariat will discuss the impact of the coronavirus in the next few days, said Michael Chapnick, direct of communications and public affairs. The Secretariat sees the outbreak as “a challenge for the region” as they prepare to host meetings in Malaysia this year.

Hong Kong Reports Second Death (11:05 a.m. HK)

A 70-year-old male who had been diagnosed with coronavirus died this morning at Princess Margaret Hospital, a spokesperson for the hospital said by phone. He had underlying illnesses and had a day trip to mainland China on Jan. 22. Local news site HK01 reported the death earlier this morning.

China Mulling Airline bailout (11:01 a.m. HK)

China is considering measures such as direct cash infusions and mergers to bail out an airline industry crippled by the virus outbreak, according to people familiar with the matter. One proposal involves allowing some of the nation’s biggest carriers — which are controlled by the state — to absorb smaller ones suffering the most from the collapse of travel, the people said, asking not to be identified because the information hasn’t been discussed publicly. To read full story, click here.

Cruise Passengers Begin to Disembark (10:10 a.m. HK)

Passengers finally began leaving a cruise ship that has been quarantined off Yokohama, Japan, the NHK reported.

Many of those who leave the ship will be subject to another 14 days of quarantine once they return home. All passengers are set to leave the Diamond Princess cruise between Wednesday and Friday. About one in seven people aboard became infected, with 542 people confirmed to have contracted the virus as of Tuesday.

To read full story, click here.

Taiwan Extends Hong Kong Tour Suspension (10:05 a.m. HK)

Taiwan’s Tourism Bureau said suspension on group tours to Hong Kong and Macau will be extended to April 30 from original schedule of March 31. Taiwan had earlier barred entry for all residents of mainland China, Hong Kong and Macau. Taiwan had also halted all passenger flitghts to China except for those to and from the Chinese cities of Beijing, Shanghai, Xiamen and Chengdu.

Gauging the Damage From the Virus (10 a.m. HK)

U.S. corporations are rushing to assess the impact on their business from the coronavirus infection spreading across China. Bloomberg economists reviewed all mentions of the coronavirus for S&P 500-listed firms – a total of more than 150 companies with a combined market cap of $9 trillion – and found that 56% of them said it was too early to gauge how the virus might play out. Another 36% said it would have an effect, but likely limited. Only 5% anticipate a severe blow. But the harsh reality on the ground in China points to a different conclusion – so companies and investors may be in for a nasty shock.

To read the full report, click here.

South Korea Confirms 15 More Cases (9:30 a.m. HK)

The Korea Center for Disease Control & Prevention confirmed 15 more cases of people with coronavirus, 13 of them in Daegu city, southeast of Seoul. Eleven of the newly confirmed cases were linked to a patient that tested positive yesterday, the CDC said. The Kyungpook National University Hospital in Daegu has been asked to close down its emergency room after at least one patient in the facility was found to have been infected.

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