The coronavirus continued to infect more people as the global count soared over 350,000 on Monday, while a skyrocketing number of confirmed U.S. cases prompted more states to mandate business closures and ‘stay at home’ orders for citizens.
The world’s largest economy now has the third largest number of infections, behind China and Italy. With nearly half of the country’s cases, New York remains a stronghold for the virus with more than 20,000 as of Monday. Over the weekend, the Empire State ordered citizens at nonessential jobs to remain at home in a desperate gambit to avert new illnesses — along with other big states like Michigan, Massachusetts, Ohio and Maryland.
Aggressive social distancing policies implemented by states and localities have turned major areas like New York City — the epicenter of the country’s outbreak — and Los Angeles into ghost towns, while forcing investors to price in an economic collapse that’s unlikely to rebound before June. On Monday, Wall Street erased the last of the market’s gains made since November 2016, when President Donald Trump was first elected.
With available COVID-19 testing still scarce, calls grew for Trump to announce a nationwide lockdown that would represent what some call the “Martial law” scenario. Meanwhile, the U.S. Surgeon General issued a stark warning that this week was likely to be bad as ramped up testing efforts result in higher case counts.
With Washington planning a massive fiscal package to bolster the economy and consumers — and Trump dropping hints that he wants to restart the economy sooner rather than later — Howard Forman, Yale School of Public Health told Yahoo Finance that it was “absolutely too soon to tell” if the isolation protocols were making a difference.
Citing the timeline from infection to demonstrated symptoms, he said that “anything we’re doing today is going to begin to have an effect approximately two weeks from now. We have to be patient and we have to wait this out.”
‘Overwhelming the policy response’
Stocks swooned once again in midday trading, as world policymakers race to contain the fallout from the coronavirus pandemic.
Shortly before noon in New York, the Dow sank more than 4% to below 18,332.74 – the level the index had closed at November 8, 2016, or the presidential election day for 2016. It came despite yet another intervention by the Federal Reserve, which announced a vastly expanded bond buying program, and a stimulus program that will exceed $1 trillion.
“The US fiscal response to offset this hit to economic activity is accelerating, but for now the impact of the containment measures is still overwhelming the policy response,” UBS Global Wealth Management’s chief investment officer Mark Haefele wrote in a note to clients on Monday.
“From here we believe market developments will be determined by the answers to two key questions: a) how quickly economic activity can normalize; and b) how much policy responses can limit corporate bankruptcies and job losses,” Haefele added.
The rapid shutdown of the U.S. economy is expected to send joblessness through the proverbial roof, with Connecticut Governor Ned Lamont telling Yahoo Finance on Monday that unemployment claims in his state were spiking dramatically.
General Electric (GE) became the latest company to announce a negative impact from the outbreak, saying it will cut 10% of its workforce. Separately, Boeing announced a two-week shutdown of some factories as the virus roils the economy, while Bed Bath & Beyond recently announced shuttering most of its stores until at least April 3.
However, CVS (CVS) and Walgreens (WAG) both announced bonuses to employees, while CVS also plans to hire 50,000 full-time, part-time and temporary positions across the country amid a spike in coronavirus-related demand.
Testing efforts expand
CVS, Walgreens and Walmart have announced the start of drive-thru testing in the past week, placing limits on who gets tested and where, in order to avoid more spreading. Walgreens has indicated their location will soon be open to the public, but restricted to individuals 65 and older.
Meanwhile, states like New York and New Jersey in collaboration with FEMA, opened public drive-thru sites to the public, with many requiring appointments or registration with the state department health. Trump has dispatched naval hospital ships to both the Big Apple and Los Angeles, and FEMA is building temporary hospital sites in New York, Washington and California.
To-date, the country has tested more than 250,000 individuals resulting in the more than 35,000 positive cases. Several companies are offering high throughput tests that reduce the turnaround time for results with a larger output for results.
However, tests are limited to locations that have the necessary testing equipment from the same provider of the testing kits. Danaher Corporation’s (DHR) Cepheid was the latest to receive FDA approval for its high throughput molecular diagnostic testing for about 5,000 locations in the country.
Separately, LabCorp (LH) announced it is “exploring all options to prioritize COVID-19 testing for the hospital inpatient population,” adding that that it will also help hospitals with testing on-site technical support.
Javier David is an editor for Yahoo Finance. Follow him on Twitter: @TeflonGeek
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