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Turkey Stages Turnaround That Could Rival World’s Economic Elite

Turkey probably capped its comeback after a recession with a brief spurt worthy of Asia’s fastest growing economies.

A mix of stimulus policies that combined interest-rate cuts and a spending splurge last year offered a quick cure for an economy scarred by a currency crash in 2018. Seasonally and working day-adjusted data due Friday will show growth in gross domestic product more than tripled in the fourth quarter from the previous three months and reached 1.5%, according to the median forecast in a Bloomberg survey.

The year-on-year rate clocked in at 5%, up from just under 1% in the third quarter, another poll of analysts showed. The annual acceleration probably overtook the pace of expansion in Indonesia and fell just short of growth in China and the Philippines.

“Authorities are prioritizing growth, which they should be able to achieve in the near term given the large range of fiscal, quasi-fiscal and monetary policy instruments available to them,” Goldman Sachs Group Inc. economists including Kevin Daly said in a note before the data release. “We think that this will come at a cost.”

Although Turkey succeeded in quickly moving past its first technical recession in a decade, it risks sacrificing economic stability down the road. As gains in consumer spending and bank lending power the rebound, the current account swung back into deficit in the past two months of 2019 and inflation is on the rise.

The lira slipped to a fresh nine-month low on Thursday and is this month’s worst-performer in emerging markets after the Brazilian real and Russia’s ruble.

Authorities are relying on cheap credit to give the economy a shot in the arm. A new central banker installed by President Recep Tayyip Erdogan in July slashed Turkey’s benchmark rate by 1,200 basis points by end-2019, a campaign that’s stretched into this year. The government has set a target of 5% for economic growth in 2020-2022.

What Our Economists Say…

“Turkey is solidifying its exit from the recession that followed its currency crisis. The government is expected to throw significant stimulus at the economy. Despite its efforts, we forecast growth will still fall short of its 5% target.”

— Ziad Daoud

Click here to view the piece.

The challenge now is how to sustain enough momentum in the face of global threats such as the coronavirus outbreak, whose fallout is wreaking havoc on mobility and supply chains.

Erdogan’s deepening entanglement in the conflicts in Syria and Libya presents another risk, as Turkey draws closer to a confrontation with Russia. On the domestic front, youth unemployment is hovering near record highs and political tensions are keeping the market on edge.

Still, the rapid-fire rate cuts have pushed down the cost of loans and deposits, and succeeded in boosting confidence. Industrial production rose on an annual basis for a fourth month in December after a decline uninterrupted for a year following the currency crisis in August 2018.

“Inevitably, as in the past, short-term gain leads to long-term pain in Turkey,” said Nigel Rendell, a senior analyst at Medley Global Advisors LLC in London. “The key issue now is whether this is a sustainable recovery or one that is engineered to show some impressive short-term growth figures.”

— With assistance by Harumi Ichikura

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States With the Highest and Lowest Property Taxes

Property tax regularly ranks among the least popular forms of taxation in the United States. Though property taxes can be set by local authorities such as cities, counties, and school boards, states often establish parameters in order to keep tax rates somewhat uniform. Each state, however, establishes different parameters, and as a result, what homeowners end up paying out of pocket can vary considerably, depending on the state they are in.

Using data from tax policy research organization the Tax Foundation, 24/7 Wall St. reviewed total annual property tax collections as a share of the total value of owner-occupied housing units at the state level to identify the states with the highest (and lowest) property taxes. 

It is important to note that a low property tax rate does not necessarily mean low tax collections overall in a state. State and local governments need to meet their financial obligations one way or another, and a low effective property tax rate can often mean that other tax rates, like sales or income taxes, might be higher. These are the states where Americans are paying the most in taxes. 

One of the most common ways state and local governments use revenue from property taxes is to fund public school systems. Indeed, states with higher effective property tax rates also tend to have higher than average per pupil education spending. While higher school spending alone does not necessarily improve outcomes, better funded schools can often more easily afford luxuries like smaller class sizes and a broader curriculum. Here is a look at the best public high school in each state.

Click here to see the states with the highest and lowest property taxes
Click here to read our methodology

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Limited Virus Testing in Japan Masks True Scale of Infection

Japan is becoming a center of concern as the coronavirus spreads globally, with the country’s official infection tally suspected to be the tip of the iceberg of a much wider outbreak.

As of Friday, Japan had about 200 confirmed cases of the pneumonia-causing virus, excluding those that erupted on the Diamond Princess, a cruise ship quarantined for weeks in Yokohama harbor. In neighboring South Korea, however, the number of infections has swelled rapidly, reaching almost 1,800 after the government tested tens of thousands of people to get a clearer picture of the deadly outbreak.

That divergence has experts — and members of the public — concerned about Japan’s approach to diagnosis.

“For every one who tests positive there are probably hundreds with mild symptoms,” said Masahiro Kami, chair of the Medical Governance Research Institute in Tokyo, and a practicing doctor. “Those with mild symptoms are not being tested.”

While the government says it has the capacity to conduct 3,800 tests a day, only 5,700 were actually carried out between Feb. 18-23, Japanese Health Minister Katsunobu Kato told parliament Wednesday. That included the tests made on passengers and crew of the Diamond Princess, where Japan’s attempt to quarantine the boat resulted in an explosion in infections to more than 700 cases.

No Bans

Japan’s low level of confirmed infections has enabled Prime Minister Shinzo Abe to maintain a relatively relaxed stance on the outbreak compared with South Korea and China, where more than 78,000 cases and over 2,700 deaths have been recorded.

Unlike other countries in the region, Japan hasn’t imposed travel bans on citizens from highly infected nations — including China — and Abe has encouraged, but not enforced, the cancellation of major public events. Many people in Tokyo continued to commute to work in packed trains. As public criticism mounted, Abe announced Thursday evening that schools will be shut from next week to April.

“In order to grasp the current situation, we should test,” said Kazuhiro Haraguchi, a lawmaker with Japan’s opposition Democratic Party for the People. “Tests are not 100% reliable, but we need to know the facts.”

Minister Kato said that public health centers had refused to test some people for the virus, probably because they were concerned they didn’t have sufficient capacity.

As Cases Mount, Japan Rapidly Becomes a Coronavirus Hotbed

The country has already come under fire for not testing the Diamond Princess passengers more extensively, with at least two Japanese testing positive for the virus after they returned home. Both had used public transport and been out in the general public after disembarking from the ship.

There’s also rising anxiety over the number of Japanese virus patients whose infection routes can’t be traced. For example authorities have not yet been able to identify connections between those who got infected in the northern island of Hokkaido, which has now grown to become the biggest outbreak in Japan with 54 cases.

Unlike some other Asian countries, Japan didn’t see a widespread local outbreak during the SARS and MERS virus epidemics. That lack of experience may have left it ill-equipped for dealing with the novel coronavirus, which is thought to be more infectious than those diseases, though less deadly.

How the Novel Coronavirus Can (Maybe) Infect You: QuickTake

Unlike South Korea and many other developed countries, Japan doesn’t have a Center for Disease Control, meaning virus prevention and outbreak control is in the hands of bureaucrats from the health ministry, aided by a group of experts.

While there is a national benchmark for how testing for the virus should be undertaken, some cities and regions are applying different standards.

The official guidance is for anyone with mild symptoms to stay at home. Those with serious conditions are told to contact a hotline, where they can be linked to an appropriate medical facility. Doctors can recommend testing at Japan’s local public health centers if they suspect a coronavirus infection.

U.S. to Expand Coronavirus Tests After Delay in Surveillance

Approach Criticized

Some public health centers — including in Tokyo, the city of Nagoya and the Wakayama prefecture — say they haven’t had consistent supplies of testing kits to meet requirements. Wakayama, which has confirmed 11 virus infections, is using its own parameters to decide when testing is needed.

Hospitals and clinics could also be concerned that if a case is confirmed on site, they’ll be forced to shut down for disinfection, according to opposition lawmaker Haraguchi, who wants the government to compensate operators in these cases.

Even a member of the government’s expert panel on the virus has criticized their efforts on diagnosis. Hitoshi Oshitani, a professor at Tohoku University Graduate School of Medicine, said last week that Japan’s initial efforts at testing were like using a pen light to hunt for a ping pong ball in the Tokyo Dome baseball stadium.

The handling of the Diamond Princess virus outbreak had already undermined trust in the government’s capacity to handle the crisis. After discovering cases of the virus, Japan locked the ship down for 14 days, a move that some public health experts said probably fueled the spread on board. About a fifth of the ship’s 3,700 passengers and crew have tested positive for the virus.

‘Get Tested’

Health minister Kato told parliament this week the government is working on a system to support the private sector to conducts tests so that more people can be tested for the virus.

With trust in authorities eroded, a broader testing regime is now needed to calm public unease, said Kenji Shibuya, director of the Institute for Population Health at King’s College London, and a former chief of health policy at the World Health Organization.

“Scientifically we should target and prioritize the patients,” he said by email. “But it is now beyond that — we are dealing with public fear, and to tackle it, we need to give people an opportunity to get tested.”

— With assistance by Lisa Du, Grace Huang, Yoshito Okubo, and Jae Won Yoon

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Sangamo Partners With Biogen to Target Alzheimer’s and Parkinson’s Development

Many of the larger biotechnology and pharmaceutical companies have changed strategies from making acquisitions of speculative biotech outfits. In many cases it is far cheaper to just partner up with these smaller and more nimble companies than to make an acquisition, and the larger partners still often get massive upside opportunities if the partnerships blossom into major drug sales. Biogen Inc. (NASDAQ: SGMO) has announced a global collaboration with Sangamo Therapeutics, Inc. (NASDAQ: SGMO). The plan is to develop gene regulation therapies targeting Alzheimer’s, Parkinson’s and other neuromuscular and neurological diseases.

Sangamo closed with a $772 million market cap on Thursday, but barring anything more major in the stock market meltdown that market cap is likely to be much higher on Friday. Biogen is set to pay Sangamo $350 million in an upfront payment that includes a licensing fee and an equity investment into Sangamo shares. Perhaps the biggest part of the news is that Sangamo is entitled to receive up to more than $2.3 billion in milestone payments and additional royalties on potential net commercial sales.

According to the joint press releases, the initial focus will be on the development of ST-501 for tauopathies including Alzheimer’s disease, as well as ST-502 for synucleinopathies including Parkinson’s disease and a neuromuscular target with exclusive rights for nine additional undisclosed neurological targets.

This will be a potential game-changer for Sangamo. Refinitiv was calling for collaboration and revenues of just $85 million in 2020. The company already had capital reserves but has been burning cash each year on R&D and operations. As of last September, it had accumulated an earnings deficit of about -$661 million since inception.

Shares of Sangamo Therapeutics closed down 3.25 at $6.66 on Thursday, but the stock popped over 45% to $9.80 in the after-hours trading session as the deal was announced. Its 52-week trading range was $6.43 to $13.91.

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Should GE Shares Have Fallen 10 Straight Days?

When you get into crazy markets, sometimes logic and sensibility have to be thrown out the window. General Electric Co. (NYSE: GE) is far from an economically immune company. The company’s turnaround has been long and painful, and CEO Larry Culp’s tenure has not come with its own bumps and bruises even though he is a very well respected CEO with a solid history. GE’s shares have now fallen for 10 consecutive days.

The outbreak of the novel coronavirus hit literally right after trade was supposed to be picking back up as it was just days earlier that the U.S. and China signed their phase-one trade pact. Is more than a 21% stock drop in two-weeks, even in a violent and down market, a fair assessment? The last day that GE closed up on the day was February 12, 2020 at $13.16, the following day it fell to $12.85 and shortly before the closing bell on February 27 it was down about 2.2% at $10.70.

Where things get even more interesting is that GE shares closed out 2019 at $11.16. That means it was just one day ago when GE closed at $10.95, after a $11.32 close the prior day, when GE shares went negative year-to-date even though the Dow was approaching a 10% correction from its peak.

It was just back on February 19 that CEO Larry Culp outlined its cash burn rates from the 737 MAX issue and seemed to talk down the exposure to even higher losses in the long-term care insurance that has plagued the company. GE’s issues around power have also been well known, but Culp even defended GE there and talked up the range of cash flow from industrial operation in 2020.

There were other issues to consider far beyond the biosciences sale to Danaher Corp. (NYSE: DHR), where Culp was running the show prior to taking over the helm at GE. With the woes of The Boeing Co. (NYSE: BA) and its 737 MAX fleet grounding and more recent manufacturing halts.

There were headlines on Thursday that Boeing has reached a deal to cover 2020 engine payments for the GE-Safran joint venture to ease the burden for the U.S. and French companies. Boeing had been producing about 40 of the 737 MAX planes per month before curtailing and then halting production, and the aviation industry was running out of places to store the grounded planes. This would seem to relieve at least some pressure for the industrial companies.

A March 4, 2020 investor meeting is expected to be the next major event for GE shareholders. The company is expected to clarify its guidance for 2020. Its last formal guidance was calling for earnings of close to $0.55 per share and for the conglomerate to produce roughly $3 billion in fiscal year 2020 cash flow. That last guidance, and the update from earlier in February, were not entirely naive of the coronavirus outbreak in China, but they did not include the current coronavirus woes that are growing as more cases are being highlighted in the United States and the outbreaks in other nations are becoming much more widespread.

BofA Merrill Lynch had been the most aggressive firm on Wall Street with a street-high target shortly after GE’s earnings report. That was before the height of the coronavirus and was certainly before things started getting this bad in the United States.

The question may need to come back up as to whether or not GE’s analysts need to trim their annual expectations based on the slowdown that has been seen so far. Sadly, GE and other companies may also not have any better visibility into the real outlook for all of 2020 any better than the rest of us. After all, they are at the mercy of the economy and at the mercy of what happens under this COVID-19 outbreak just like the rest of us.

GE’s 52-week trading range is $7.65 to $13.26 and its Refinitiv consensus analyst target price was $12.89 on last look.

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Climate Fears About Cloud Computing Have Been Vastly Overstated

This has been the decade of the data center, which can be measured in a ten-fold increase in traffic and a 25-fold jump in worldwide storage. The surge was thought to come with a steep cost for the climate, since all those racks of servers run hot enough to require special cooling systems and vast amounts of energy. 

But data centers are rapidly becoming more energy efficient, and new research suggests there’s no longer a close link between more cloud computing and more energy use. A report published Thursday in Science credits the progress to better management, more efficient hardware and the rise of “hyperscale” data centers created by tech giants.

Back in 2010, according to the report, data centers globally used about 194 terawatt-hours of electricity—about as much power as Iran used that year. By 2018 that figure had increased to 205 TWh. That’s a 6% rise in power use, in a period that saw data-center computing grow by 550%.

The data-center industry’s 20% annual improvement in energy intensity dwarfs all other major parts of the economy. The power used today by data centers, 1% of the global total, is roughly the same as it was in 2010.

This was an unexpected result. Analysts have extrapolated the incredible rise in cloud computing on to data-center electricity consumption “leading to unreliable predictions of current and future global data center energy use,” according to the report in Science. Instead of collecting and analyzing power-use data, some researchers had been taking the growth factor seen in data-center internet traffic and assuming energy use was growing just as quickly. 

This new research is the first major attempt to compile a bottom-up view of data-center energy use in a decade. Researchers based their work on reports published by Cisco Systems, Inc., Lawrence Berkeley National Laboratory and the International Energy Agency, among other sources.

“We don’t have nationally reported statistics for data centers,” said Eric Masanet, lead author and a mechanical engineering professor at Northwestern University. That created a lot of work for him and his colleagues. “We don’t see these estimates come out very often.”

In a blog post Thursday, Google celebrated the findings and touted the company’s own efforts at buying renewable power and cutting energy use. Urs Hölzle, senior vice president for technical infrastructure, wrote that Google can now harness about seven times as much computing power from the same amount of energy as it could five years ago. (Google and its parent company, Alphabet Inc., were not involved in the research by Masanet’s team or its funding.)

Can the trend continue? The rise of hyperscale data centers and potential for better efficiency in storage means that computing and power use may continue to diverge, at least through the next doubling of data-center workloads, which is estimated to take 3 to 4 years. 

Masanet and his co-authors recommend policy changes to support continued efficiency gains. Government efforts such as the Energy Star program in the U.S. can include servers and networking equipment. Renewable energy can play an even bigger role in data centers through tax credits and procurement standards. Finally, there can be better data about data centers. 

“Data centers are becoming way too important to not rally more research behind them,” Masanet said.

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Market in turmoil over fears of a coronavirus-induced global recession

On the Monday after Lehman Brothers collapsed in September 2008, the FTSE 100 fell 3.9%, which we now know was a woefully complacent first take on events. London’s blue-chip index, then at 5,204, went on to shed another 1,400 points in the following six weeks.

It’s a point to remember when looking at the coronavirus “carnage” on stock markets this week. Short-term share price movements, such as Thursday’s 3.5% decline in the FTSE, don’t tell you much when truly big global events happen. Even the 8% fall this week feels severe but could anyone claim to be surprised, given the current coronavirus news flow, if the decline soon became 16%?

As in the weeks after Lehman’s collapse, investors crave reassurance when none is possible yet. It is almost certain, so the experts tell us, that an effective vaccine will be developed within a year or so, but the idea that the spread of the coronavirus could trigger a global recession this year, as thinktank Capital Economics suggests, is plausible speculation.

So too is Goldman Sachs’ warning that US companies could record zero earnings growth this year if coronavirus becomes widespread. Wall Street’s spreadsheets currently contain no projections remotely close to that outcome.

Equally, of course, it’s hard to estimate how much gloom is already priced in. China-reliant supply chains are creaking, as Apple and Microsoft and others have warned, but the hard-to-measure rate of recovery is what matters on that front.

It is, though, possible to say central bankers won’t be much help to investors or the economy any time soon. They, like everybody else, don’t know the scale of what’s coming. In any case, as Sir Jon Cuncliffe, a deputy governor of the Bank of England, said, monetary policy can’t do much about a “pure supply shock”, such as goods not arriving in the UK. Investors, one could say, are even more than in the dark than they were in 2008.

Persimmon shareholders have dodged a bullet

David Jenkinson will depart housebuilder Persimmon with shares in the company worth roughly £45m, his prize from the same absurd incentive scheme that bestowed £75m on his predecessor as chief executive, Jeff Fairburn.

Perhaps Jenkinson, only a year after replacing Fairburn, wants to spend more time with his winnings. Or perhaps he’s just recognised what was blindingly obvious to outsiders: Persimmon’s claims to cultural reform, and its pledge to improve the quality of its houses, lacked credibility while a veteran of the old regime was at the helm.

Any doubt on the latter point evaporated with the damning independent report that the board, to its credit, published last December: in short, Persimmon had been building too many shoddy homes that had fire risks; box-tickers ruled the roost; and the company saw itself as “land assembler and house-seller rather than a housebuilder”.

Customers now come first, says chairman Roger Devlin, and, if you look closely at Thursday’s full-year numbers, there is circumstantial evidence to support the boast. An extra £213m was invested in “work in progress”, the cost of actually finishing the job, rather the handing homes to buyers when they’re full of snags.

Harder evidence of true reform, and commitment to reputational improvement, can only judged over time. It is why Devlin would do well to appoint a non-insider to replace Jenkinson. Better still, go for somebody from outside the housebuilding industry, an insular sector that enjoys nothing more than marking its own homework.

In the meantime, Persimmon’s shareholders should count themselves lucky. In a normally functioning market, there would be a heavy price to pay for pursuing a strategy that short-changed customers but made executives as rich as Croesus. Instead, Persimmon is still achieving pre-tax profits of £1bn and still has a return on capital employed of 37%. Help to buy has a lot to answer for.

Bonus first, results later at Reckitt Benckiser

How executive pay also works: jackpot rewards are handed out before the costs of the chief executive’s vainglorious acquisition emerge.

Rakesh Kapoor earned about £100m during his eight years at Reckitt Benckiser, the Dettol-to-Durex consumer goods giant, but it’s only now that shareholders can see how his big bet from 2017 turned out.

Mead Johnson Nutrition, a baby milk firm bought for £13bn, ruined Reckitt’s full-year numbers on Thursday with a £5bn impairment charge. The acquired business is decent, it’s just that Reckitt paid far too much. Kapoor’s team thought more Chinese babies would be born, the company told its shareholders with a straight face.

“We look forward to a new decade,” proclaimed new boss Laxman Narasimhan. So, presumably, does Kapoor in comfortable retirement.

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Watchdog opens NMC Health inquiry amid accounting scandal

The financial watchdog has launched a formal investigation into NMC Health hours after shares in the FTSE 100 healthcare group were suspended from trading amid a deepening accounting scandal.

The news of the investigation by the Financial Conduct Authority came the day after Abu Dhabi-based NMC removed its chief executive and placed its finance chief on extended sick leave as its own investigation into its finances continues.

NMC’s shares have lost two-thirds of their value since the US-based short-seller Muddy Waters questioned its financial statements in December. The firm, which runs private hospitals and health services in the United Arab Emirates, has also admitted it is unclear who controls its biggest shareholdings.

Healthcare empire NMC should be clear about who owns its shares | Nils Pratley

This week NMC shared details of an independent review of the firm’s finances, led by a former FBI director. The review revealed that companies controlled by NMC’s founder and another executive had accessed $335m (£260m) in secret financing since early 2018, without the knowledge of the company’s board, and which did not appear on its balance sheet.

The review found that companies which accessed the supply chain financing are apparently linked to NMC’s founder, the Indian-born billionaire Bavaguthu Raghuram Shetty, and its major shareholder and former deputy chair, Khaleefa Al Muhairi.

In a statement issued on Thursday, Muhairi rejected all allegations of wrongdoing and insisted: “I have not been given a reasonable opportunity to engage with and assist the investigation with the benefit of the key documentation relating to the events in question, as I would have wished.”

The healthcare group said the FCA had agreed to a temporary suspension of its shares on Thursday “to ensure the smooth operation of the market”. It has said it will continue to cooperate with the financial regulator “and any and all other relevant authorities”.

Following the removal on Wednesday of NMC’s chief executive, Prasanth Manghat, the founder of Muddy Waters, Carson Block, said: “At this point, the company’s announcements speak for themselves and seem to be even more damning than our initial report was.”

A fresh investigation into a FTSE 100-listed company will also raise questions about London’s governance of firms listed on its stock exchange, following scandals concerning the mining companies ENRC and Bumi.

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Stocks fall into correction

New York (CNN Business)A market meltdown. Surging recession fears. And a sudden spotlight on America’s health care system. Goldman Sachs is warning Wall Street that the coronavirus could cost President Donald Trump the election.

The potential political fallout from the coronavirus adds yet more uncertainty for investors trying to assess the impact of the fast-moving epidemic.
“If the coronavirus epidemic materially affects US economic growth it may increase the likelihood of Democratic victory in the 2020 election,” Goldman Sachs analysts led by Ben Snider wrote in a report published Wednesday night.

    That could be a negative for stocks because investors have been hoping for a continuation of the low-tax, light-regulation approach of the Trump administration. And Trump of course has been laser-focused on boosting stock prices.
    How the coronavirus could spark a severe slowdown or recession in America
    It’s no secret that a slowing economy can deal a fatal blow to the candidacy of a sitting president. That’s what happened in 1992 when Bill Clinton unseated President George H.W. Bush.

    In particular, Goldman Sachs notes that economic growth during the second quarter of an election year has been a “key predictor” of past presidential races.

    Recession fears rise

    Economists are warning that the coronavirus could spark an imminent economic slowdown or even recession. Moody’s Analytics chief economist Mark Zandi said he now sees a 40% chance of a US recession during the first half of 2020, up from 20% previously.
    Even former Federal Reserve chief Janet Yellen has acknowledged the outlook for the US economy is darkening.
    “It’s just conceivable that it could throw the United States into a recession,” Yellen said at an event in Michigan Wednesday, according to Bloomberg News.
    Coronavirus fears are roiling financial markets, with the selloff escalating after US officials confirmed the US coronavirus case of “unknown” origin.
    Fearing a recession, the S&P 500 has plunged about 9% this week. That would be the worst weekly percentage decline since the 2008 financial crisis. Oil prices have crashed into a bear market. And demand for safe assets is so strong that 10-year Treasury yields have dropped to record lows.
    The CNN Business Fear & Greed Index is flashing “extreme fear,” a sharp swing from “neutral” just a week ago.
    Of course, investors often overreact, selling first and asking questions later. If the United States avoids a serious outbreak and the economy proves resilient, stocks and growth could rebound quickly.
    A Trump defeat would come as a shock to many on Wall Street, who have been comforted by the success of Bernie Sanders during the Democratic presidential nomination.
    “Many market participants believe Trump would fare particularly well against Sanders in a general election,” Goldman Sachs wrote.

    ‘Thrilled if Bernie wins the nomination’

    That helps explain why Trump’s reelection chances on prediction platform PredictIt have climbed in tandem with the rise of Sanders.
    Up until recently, investors have displayed few jitters about the risk of a Sanders White House. If anything, some analysts have argued that the success of Sanders helped lift stocks to record highs earlier this month because investors felt he’d be an easy foil for Trump.
    “The stock market should be thrilled if Bernie wins the nomination,” Greg Valliere, chief US policy strategist at AGF Investments, wrote in a note to clients Thursday.
    Sanders, a self-described democratic socialist has called for breaking up big banks, providing Medicare-for-All, banning oil and gas fracking and instituting a wealth tax. Sanders also wants to unwind the corporate tax cuts that juiced stock prices.
    Although the Sanders platform would face opposition from many in Congress, his election would at a minimum create vast uncertainty for large parts of the US economy.

      Goldman Sachs is advising clients not to count Sanders out.
      “In contrast with the prevailing market narrative, head-to-head polls show Senator Sanders would be competitive against President Trump in the general election,” the firm wrote in the report.
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      Asian Markets In Negative Territory On Coronavirus Concerns

      Asian stock markets are in negative territory on Friday following the weak cues overnight from Wall Street amid worries about the rising number of coronavirus infections in Beijing as well as outside China and its impact on the global economy. More companies are issuing fresh warnings about the negative impact of the coronavirus on their earnings.

      China confirmed 889 new cases of the coronavirus infections as of Thursday. Meanwhile, South Korea reported 52 new cases of the coronavirus on Friday, raising the total number of infections in that country to 156.

      The Australian market is declining after recent strong gains and following the negative cues from Wall Street. Weak local corporate earnings results also dampened sentiment.

      The benchmark S&P/ASX 200 Index is losing 14.70 points or 0.21 percent to 7,147.80, after touching a low of 7,135.70 earlier. The broader All Ordinaries Index is lower by 16.30 points or 0.22 percent to 7,238.90. Australian markets reached new record highs before ending off their best levels.

      The major miners are weak. Fortescue Metals is declining more than 1 percent, BHP is lower by 0.3 percent and Rio Tinto is edging down 0.1 percent.

      Oil stocks are also mostly lower despite an increase in crude oil prices overnight. Oil Search is lower by 0.4 percent and Santos is down 0.3 percent, while Woodside Petroleum is adding 0.5 percent.

      Gold miners are mixed even as gold prices gained overnight for a sixth straight session overnight. Newcrest Mining is rising 0.5 percent, while Evolution Mining is down 0.1 percent.

      In the banking space, ANZ Banking and Westpac are higher by 0.5 percent each and Commonwealth Bank is rising 0.3 percent, while National Australia Bank is edging down 0.1 percent.

      Inghams reported a 69 percent drop in first-half profit and will pay a reduced interim dividend. The poultry group’s shares are lower by more than 1 percent.

      Ardent Leisure Group reported a wider net loss for the half year despite a 16 percent increase in revenues, and said it will not pay an interim dividend. The theme parks operator’s shares are losing more than 6 percent.

      In the currency market, the Australian dollar is higher against the U.S. dollar on Friday. The local unit was quoted at $0.6616, compared to $0.6647 on Thursday.

      The Japanese market is edging higher in choppy trade following the negative cues from Wall Street. Investors remained cautious ahead of the release of a raft of local economic data later today.

      The benchmark Nikkei 225 Index is adding 17.26 points or 0.07 percent to 23,496.41, after touching a low of 23,420.23 in early trades. Japanese stocks closed higher on Thursday.

      Market heavyweight SoftBank is rising almost 2 percent, while Fast Retailing is declining 0.6 percent. In the tech space, Advantest is adding 0.5 percent, while Tokyo Electron is down 0.4 percent.

      The major exporters are mixed on a weaker yen. Panasonic is adding 0.6 percent and Sony is edging up 0.1 percent, while Mitsubishi Electric is unchanged and Canon is edging down 0.1 percent.

      Among auto stocks, Toyota Motor is higher by more than 1 percent and Honda Motor is advancing almost 1 percent. In the oil sector, Japan Petroleum is declining 0.7 percent, while Inpex is adding 0.2 percent after crude oil prices rose overnight.

      Among the major gainers, Z Holdings and Rakuten are rising more than 4 percent each, while Mitsui Mining & Smelting and Sumco Corp. are higher by almost 4 percent each.

      Conversely, Oji Holdings is losing more than 2 percent and Sumitomo Realty & Development is lower by almost 2 percent.

      In economic news, Japan is today scheduled to release January figures for consumer prices, February readings for the manufacturing PMI from Jibun Bank, and the services and composite PMIs from Nikkei. Japan also will see December data for the all industry activity index.

      In the currency market, the U.S. dollar is trading in the 112 yen-range on Friday.

      Elsewhere in Asia, South Korea and Hong Kong are losing more than 1 percent each, while Singapore, Indonesia, Malaysia and Taiwan are all modestly lower. Shanghai and New Zealand are edging lower.

      On Wall Street, stocks closed lower on Thursday after regaining some ground following a late-morning sell-off. Selling pressure waned shortly after the start of trading as traders also reacted to the People’s Bank of China’s widely expected move to cut its benchmark one-year loan prime rate by 10 basis points. The late-morning pullback was partly attributed to renewed concerns about the coronavirus outbreak, although it was not immediately clear what sparked the sell-off.

      The Dow dropped 128.05 points or 0.4 percent to 29,219.98, the Nasdaq slid 66.21 points or 0.7 percent to 9,750.96 and the S&P 500 fell 12.92 points or 0.4 percent to 3,373.23.

      The major European markets all moved to the downside on Thursday. While the U.K.’s FTSE 100 Index fell by 0.3 percent, the French CAC 40 Index and the German DAX Index slid by 0.8 percent and 0.9 percent, respectively.

      Crude oil prices rose on Thursday after official data showed a smaller than expected increase in U.S. crude inventories in the week ended February 14th. WTI crude for March ended up $0.49 or about 0.9 percent at $53.78 a barrel, on the expiration day.

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