February 10

2/10 - Following near panic just 10 days ago, markets appear to have adjusted to the Coronavirus scare. The Dow Jones Industrial Average dropped 2.3% on Jan 31, from 28,858 to 28,200. However, fears subsided, and the Dow rebounded by 3.2% to 29,101 last week. Investors appear to be betting that the virus won’t put a big dent in U.S. growth. Goldman Sachs said it expects the Coronavirus to reduce U.S. GDP by about a half-point to 1.7% in Q1, mostly due to Chinese supply chain disruptions, then bounce back to 2.0% in Q2. But the market rebound and the Goldman forecast are both based on the assumptions that the virus will be short-lived and that Americans won’t panic – and it’s far too early to make that call. The travel industry will be the virus’s first victim – but public fear of both meeting places and food-handlers will put restaurants at risk if U.S. infections spike.