Monday saw the global number of infections top 90,000 as cases in South Korea and Italy surged past 4,800 and 2,000 respectively. 8 countries also recorded their first cases including Senegal, Portugal and Jordan with 924 new infections recorded globally. South Korea’s 600 new cases made the bulk of infections with China recording 202 new cases. The spread outside China has been growing at a faster pace than in China for a week now.


US stocks bounced back from the previous week’s selloff in emphatic fashion on Monday as markets bet on support from policymakers to soften the blow of COVID-19. This followed statements by ECB President Christine Lagarde on Monday that Europe’s central bank would stand ready to support the economy against headwinds posed by the coronavirus. The DOW notched it’s biggest one-day percentage gain since 2009, up 5.09% while the S&P and the NASDAQ rose 4.60% and 4.49% respectively. Treasury yields closed lower with 2Y and 10Y USTs closing at 0.865% and 1.1386% respectively.


The UK’s Department for International Trade said on Monday that a free trade deal with the US may only produce a 0.16% boost to the economy over the next 15 years. The figures prompted claims from some trade professionals that the net effect would be negligible compared to the loss in trade from leaving the EU with a 2018 study suggesting growth would be down 2-8% over the same period. The release, which showed negotiating objectives for talks with the US, expects the deal to be of greater benefit to Scotland as well as the midlands and northeast of England. The pound closed weaker at $1.2754 while yield on 10Y and 30Y UKTs closed lower at 0.406% and 0.918% respectively.


The ECB joined the chorus of central banks pledging to alleviate headwinds brought about by the coronavirus if need be. Speaking late Monday, President Christine Lagarde said the outbreak “creates risks for the economic outlook” echoing earlier remarks by the Fed and the BoE. Lagarde’s remarks come about a week before the next policy meeting highlighting growing concern over the impact of the virus on the eurozone economy. The market appears to be already expecting another 10bps cut to the ECB rate at the March 12 meeting with the implied overnight rate having gone lower according to Bloomberg’s Eurozone OIS model. The euro closed firmer at $1.1134 while yield on 10Y and 30Y DBRs closed lower at -0.624% and -0.167% respectively.


Asian markets opened mostly higher on Tuesday as investors were encouraged by remarks from central banks that they are ready to step in to shield economies from the coronavirus. The Reserve Bank of Australia did its part on Tuesday shaving 25bps off its benchmark rate to a record low of 0.50%. The ASX in tune closed higher, up 0.69% while the CSI rose 0.74%. The NIKKEI and the HANG SENG shed early gains to close lower however at -1.22% and -0.03% respectively.


Turkey’s economy appears to have fully turned a corner following a recession in 2019 going by Q4 GDP growth. Following a sustained period of easing that has seen the benchmark rate drop 13.25% to 10.75% and a splurge of government spending, the economy grew 6% YoY in the last quarter of 2019, above a median estimate of 5% in a Bloomberg survey. The government has also focused on boosting credit growth with consumer loans having grown some 18% at the end of 2019 from the year’s low in February. The lira recovered from Friday’s all-time low, closing at 6.1795 to the dollar while TURKEY 47s were up some 2 points, trading in the low 88s.


President Jair Bolsonaro weighed in on the weakening real on Thursday saying it’s bound to influence the country’s imports. His comments came as the currency continued weakening against the dollar bringing its decline for the year to 10%. Bolsonaro’s comments contrast with the calm of his senior policymakers, central bank President Roberto Neto and Economy Minister Paulo Guedes. Neto said there is no pre-determined level for the floating exchange rate while Guedes said the weakness was “absolutely natural” with interest rates so low. The real was slightly weaker on Monday, closing at 4.4744 to the dollar, while BRAZIL 50s were about a point higher, trading in the low 107s.


Russian assets were higher on Monday as oil prices recovered with Brent closing at 51.90 per barrel, over a point higher than Friday levels. The ruble closed firmer at 66.4258 to the dollar while yield on 10Y RFLBs fell as low as 17bps during the day before paring to close only 3ps lower. Elsewhere, Russia’s manufacturing PMI improved for a third straight month with the February figure coming in at 48.2 from January’s 47.9. While the figure remains in contraction territory, it marks some improvement from November’s 45.6 low, more so considering the coronavirus. RUSSIA 47s were higher, trading in the low 130s.