Europe, Middle East and Africa
The coronavirus in Italy has decimated the country economically, while leading to over 2,000 deaths. To help improve the country’s poor financial outlook, the government has approved an infusion of $28 billion.
“The decree throws a financial lifeline to families and firms who face hardship after the government last week ordered a draconian lockdown on the entire country to stem the contagion,” according to Reuters.
“This is a weighty economic package. We never thought we could face this flood with mops and buckets,” Prime Minister Giuseppe Conte said in a news conference.
The health crisis affecting the nation is so severe that it has the potential to force the country into a recession. “Analysts say the crisis will plunge Italy into its fourth recession in just 12 years and batter company balance sheets. The Milan bourse lost a further 6% on Monday, meaning it has now fallen 40% in barely three weeks,” according to Reuters.
To help provide a stimulus to workers hurt by the coronavirus, Italy is not allowing companies to fire employees and is also postponing mortgage payments.
“We can speak about an Italian model not only due to our strategy to curb contagion, but we can also start to talk about it regarding our political and economic strategy to tackle this great political and social emergency,” according to the Prime Minister.
In Japan, Prime Minister Shinzo Abe said the government would also provide welcome stimulus to the country, which is struggling with the coronavirus as well. While he hasn’t declared a state of emergency in the region, the country is feeling the effects of a lack of tourism and a hurt financial state as a result.
“The pandemic has constrained the global economy and Japan's along with it, sinking the stock market and throttling business activity. Abe said that while the priority is to prevent the spread of the virus, the government's ‘unprecedented ideas’ will result in bold measures,” according to Nikkei.
On top of health and economic concerns, the country must also soon make a decision about the upcoming Tokyo Olympics, which is just four months away. Abe recently said that "in cooperation with the International Olympic Committee, we hope to overcome the virus and hold [the event] as planned,” as noted by Nikkei.
U.S. stocks recently looked to post their first back-to-back gain since the coronavirus crisis began as investors awaited unprecedented government spending packages aimed at countering the hit from the pandemic, according to a report from Bloomberg.
The S&P 500 Index was headed toward its biggest two-day advance since 2008 after negotiations in Congress paved the way for a vote on the bill this week. Boeing Co. rallied more than 30%, lifting the price-weighted Dow Jones Industrial Average for a second day.
Despite hopes surrounding the stimulus agreement, James Bullard of the St. Louis Federal Reserve Bank told reporters that he expects jobless claims to surge and said the U.S. won’t resume normal life until people feel safe, according to the Bloomberg report.