Beware of chain reactions! Apple revenue warning spooks markets: gold swells $20 to $1,600! New breakthroughs in China

Constantly get control of the epidemic in China, the world’s most valuable technology company apple released on February 18, revenue warning, it highlights the new crown pneumonia outbreak influence on global supply chains, prompted investors to assess the situation about the economy and the influence of the company, have increased risk aversion, spot gold overnight rally $20 breakdown 1600 mark, at the same time, the dollar again refresh the four-month highs. During the session, there was an increased focus on the central bank and companies’ assessment of the outbreak, while intraday data focused on U.S. PPI.

Major outbreak breakthrough: for the first time in China, the number of newly discharged patients exceeded the number of newly diagnosed patients

According to the latest data from the national health and construction commission, from 0 to 24:00 on February 18, 31 provinces (autonomous regions and municipalities directly under the central government) and the xinjiang production and construction corps reported 1,749 new confirmed cases, 236 new severe cases, 136 new deaths (132 in hubei, one in heilongjiang, shandong, guangdong and guizhou) and 1,185 new suspected cases.

On the same day, 1,824 new cases were cured and discharged from hospital, and 2,014 close contacts were released for medical observation.

As of 24:00 on February 18, according to reports from 31 provinces (autonomous regions and municipalities directly under the central government) and the xinjiang production and construction corps, there were 57,805 confirmed cases (including 11,977 severe cases), 14,376 cured and discharged from hospital, 4,004 deaths, a total of 74,185 confirmed cases and 5248 suspected cases. A total of 574,418 close contacts were traced, and 135,881 close contacts were under medical observation.

A total of 94 confirmed cases have been received from Hong Kong, Macao and Taiwan: 62 in the Hong Kong special administrative region (4 discharged and 1 death), 10 in the Macao special administrative region (5 discharged) and 22 in the Taiwan region (2 discharged and 1 death).

Through the statistical data, we can find that the new cases outside hubei province fell 15 times in a row and more than one thousand people were cured and discharged from hospital in the whole country for 7 days in a row. In addition to the above two trends, there was a major breakthrough in the outbreak of new coronary pneumonia: the newly discharged patients exceeded the newly diagnosed patients for the first time in China!

From 0 to 24:00 on February 18, 31 provinces (autonomous regions and municipalities directly under the central government) and the xinjiang production and construction corps reported 1,749 new confirmed cases and 1,824 new cured and discharged cases on the same day, totaling 14,376 cured and discharged cases.

As a result, sentiment improved slightly during the day, with stocks in Japan and South Korea opening higher on hopes of more stimulus from the central bank and the government.

South Korea’s finance minister, hong Nam kee, said he planned to announce initial stimulus measures at the end of February.

Separately, the widening economic impact of the new coronavirus pneumonia outbreak and weak consumption have forced the bank of Japan to send a stronger message that it is no longer focused on reaching its 2 percent inflation target, according to Reuters, sources familiar with the boj’s thinking.

Meanwhile, Singapore on Tuesday unveiled an s $800 million health plan to combat the new coronavirus outbreak and two s $5.6 billion plans to address the impact on employment and the cost of living.

Apple revenue warning spooks markets as a dollar ‘flies with gold’

Apple, the world’s most valuable technology company by market value, said it would miss it’s recently announced quarterly revenue target because of slowing iPhone production and weak demand in China due to a new coronavirus outbreak.

Apple said supply of iPhones would be “temporarily limited” because manufacturing facilities in China were still operating below capacity. “These iPhone supply shortages will temporarily impact global revenue,” the company said.

In January, Apple forecast revenue of $63 billion to $67 billion for its fiscal second-quarter ending March, above analysts’ expectations of $62.4 billion.

As a result, apple ended Tuesday down 1.8% at $319, compared with an intraday low of $314.61. Meanwhile, the dow and s&p 500 fell on Wall Street.

“While we have discussed the negative impact of the pneumonia outbreak on the iPhone business over the past few weeks, the impact has resulted in significantly worse than expected revenue underperformance through mid-February,” Wedbush analyst Daniel Ives wrote in a note.

Wedbush said he remains optimistic that Apple will be able to recover from the outbreak. “While assessing the impact of missed iPhone sales, a potential rebound in the second quarter will be the focus of Wall Street, and we remain bullish on Apple for the long term.”

While the exact impact of the outbreak on China’s economic and earnings growth remains to be seen, the hope that it will prove temporary has helped lift confidence on Wall Street in recent sessions.

“It’s certainly not good news, but I don’t think it’s a disaster either,” said Michael James, managing director of equity trading at Wedbush Securities. “In general, investors are not overly concerned about the apple news and the tech stocks or the market as a whole.”

While U.S. stocks came under a bit of pressure, the dollar continued to rally, with the U.S. dollar index edging to a 4-month high of 98.48 overnight after continuing to hover around 98.45 in Asian trading on Wednesday.

In addition to continuing safe-haven demand from the outbreak, the euro’s continued decline has added to the dollar’s appeal, analysts said.

The euro, down 3.4 percent against the dollar so far this year, has lost the key 1.08 level and sentiment has turned sharply negative this month.

German investor confidence deteriorated much more than expected in February on fears that a coronavirus outbreak would depress global trade and deepen the country’s manufacturing slump, a survey showed on Tuesday. Weak economic data from the eurozone has raised concerns that monetary policy in the region will have to be looser for longer.

Investors are keeping a close eye on Friday’s eurozone manufacturing purchasing managers’ index for a better understanding of the economic impact of the outbreak.

Joe Manimbo, the senior market analyst at Western Union Business Solutions, said: “the extent of the decline in confidence could set the stage for similar weak preliminary PMI data from Germany and the eurozone on Friday.”

Some economists fear that the new outbreak, which started in China and is affecting global supply chains as well as Chinese demand, could lead to a further slowdown in German growth in the first quarter.

While the dollar continued to pull up, spot gold was not afraid of the pressure, overnight long outbreak, gold prices rose more than $20, finally closed above the 1600 mark, on Wednesday the Asian market, gold prices continued to stay firm above 1600.

“Equities are under pressure and gold is still seen as a classic safe haven because we do hear some negative news about the coronavirus and its impact on the global economy,” said David Meger, head of metals trading at High Ridge Futures.

Bart Melek, head of commodity strategy at td securities, said: “the market is starting to price in the fact that there are concerns that the whole coronavirus situation could be a bit worse than many expect, which means central Banks around the world will be somewhat more dovish.”

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