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Google searches for 'coronavirus' spike during Trump presser, raising concerns about the consumer

Google searches for “coronavirus” spiked during President Trump’s press conference on Wednesday evening, where he downplayed concerns about the virus, noting “the risk remains very low” in the U.S.

As UBS’s Global Wealth Management chief economist Paul Donovan points out in a client note, the consumer is globally important to the economy, and “fear of the virus has the potential to do so much economic damage.”

“If fear is contained at current levels, the consumer will support growth. If fear takes hold in the real world, the economic damage will be significant,” Donovan wrote.

Google searches for 'coronavirus' spiked on Wednesday evening during President Trump's press conference.
Google searches for 'coronavirus' spiked on Wednesday evening during President Trump's press conference.

Elsewhere, Credit Suisse’s global CIO Michael Strobaek also noted that “the economic impact will very much depend on the ability to reduce the transmissibility of the virus and how consumers adjust their behavior.”

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“In this context, isolating infected persons as well as adjusting behavior with regard to social interaction will be key. The difficulty in predicting the further speed of the outbreak clearly heightens economic and market uncertainty,” Strobaek wrote. “In our base case, we expect that measures taken right when the first infected persons are identified internationally will lead to a less dramatic development than we saw in China. In Wuhan, the epicenter of the outbreak, the virus initially went unnoticed, with warnings by doctors even ignored before containment measures were taken.”

This week, fears surrounding the novel coronavirus (COVID-19) turning into a global pandemic roiled financial markets.

‘Our consumers are incredible’

On Wednesday, Trump held a news conference where he was joined by Health and Human Services (HHS) Secretary Alex Azar, National Institute of Allergy and Infectious Diseases (NIAID) Director Dr. Anthony Fauci, and Centers for Disease Control (CDC) Deputy Director Dr. Anne Schuchat, and Vice President Mike Pence, who was put in charge of leading the federal response.

While fielding questions, Trump said he thinks the stock market “will recover,” touting the strength of the U.S. consumer.

“The economy is very strong. Consumer is the strongest it’s ever been. Our consumers are incredible. That’s why we’re doing well, and other countries have not even before the virus. Other countries have not been doing great. Our consumer is very, very strong, powerful economically,” Trump said.

To be sure, many on Wall Street see the potential for real downside. On the coronavirus, RBC Capital Markets head of U.S. equity strategy Lori Calvasina wrote in a note that that the bank wouldn’t be surprised to see the S&P 500 fall to 3,050, down 10% from its 2020 high. There’s also a scenario in which it could fall 14-20% to the 2,700-2,900 range. As for the election, they note that utilities and REITS are the two major sectors that don’t carry significant policy risks from Sanders, while health care, financials, and energy all do.

While the coronavirus has dominated the conversation around the markets, Calvasina and others have noted that investors are also taking Sen. Bernie Sanders’ rise “more seriously.”

Julia La Roche is a Correspondent at Yahoo Finance. Follow her on Twitter.


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