The S&P 500 Index bounced back from the worst week in six months, with major averages pushing higher after manufacturing data topped estimates. Shares in Shanghai — which hadn’t traded since holidays began Jan. 23 — tumbled the most since 2015 as the nation’s economy remained virtually shut down because of the virus. The Stoxx Europe 600 Index rose as support measures from China’s government helped stem losses in other markets.

Technology and consumer shares paced gains in the U.S. Tesla Inc. rallied above $700 a share, while Gilead Sciences Inc. climbed with China preparing to test one of the company’s new anti-viral drugs. Treasuries sank. Energy producers slid with the price of oil. The offshore yuan weakened to more than 7 per dollar. The dollar gained.

Investors shifted gears on Monday after global equities sank in their worst week since August on concern economies will falter as the virus spreads. The People’s Bank of China cut rates as it injected cash into the financial system on Monday, part of a slew of measures to shore up their financial markets. Still, the economic toll is becoming clearer, with Beijing reportedly evaluating whether its growth target this year should be softened. A manufacturing reading in the U.S. topped estimates.

“It continues to be just a big unknown, but the U.S. goes into this with accelerating growth. We go into this in pretty good shape, it’s not like we were slowing,” Jim Paulsen, Leuthold Group Inc.’s chief investment strategist, said by phone. “Typically these things don’t last forever. “They’re going to hit China really hard in the first quarter, but maybe it’s pretty much wound up by then.”

Elsewhere, the pound slid on fears of a new cliff edge in trading arrangements between Britain and the European Union. Copper futures in London halted 13 sessions of declines.

Norway’s krone fell to a three-month low versus the euro after the nation’s manufacturing PMI data came in weaker than expected and on news of a drop in China’s oil demand.

These are the main moves in markets:

Stocks:

– The S&P 500 Index increased 1.1% as of 11:01 a.m. New York time.

– The Nasdaq 100 Index gained 1.5%.

– The Stoxx Europe 600 Index advanced 0.4%.

– The MSCI Emerging Market Index lost 0.1%.

Currencies:

– The Bloomberg Dollar Spot Index advanced 0.3%.

– The British pound decreased 1.5% to $1.3014.

– The euro declined 0.3% to $1.1057.

– The Japanese yen weakened 0.2% to 108.51 per dollar.

– The offshore yuan weakened 0.2% to 7.0147 per dollar.

Bonds:

– The yield on 10-year Treasuries gained four basis points to 1.55%.

– Germany’s 10-year yield climbed one basis point to -0.43%.

– Britain’s 10-year yield advanced one basis point to 0.529%.

Commodities:

– West Texas Intermediate crude fell 0.9% to $51.05 a barrel.

– Gold futures weakened 0.5% to $1,579.70 an ounce.

– LME copper climbed 0.4% to $5,587.50 per metric ton.

Chinese stocks dropped sharply Monday as coronavirus infections on the mainland surged past 17,200, extending a sell-off that wracked Wall Street last week. The benchmark Shanghai Composite Index fell more than 8 percent on the first trading day after the Lunar New Year holiday, its steepest one-day decline in four years.

The outbreak has only intensified ever since Chinese markets were last open on Jan. 23. Many nonessential Chinese businesses have shut down, tourism has disappeared and consumer spending has plummeted.

U.S. markets roared back Monday, with the Dow Jones industrial average up 300 points. The Standard & Poor’s 500 and Nasdaq composite were both up 1 percent.

Those gains stood in stark contrast to Friday, when the Dow plunged 2 percent, wiping out January’s gains, while the S&P 500 and Nasdaq composite fell 1.77 and 1.59 percent, respectively. The declines came as the World Health Organization declared a public health emergency, and Delta Air Lines and American Airlines joined other major carriers in suspending all service to China.

Saudi Arabia is pressing for a major oil production cut as coronavirus threatens crude demand, the Wall Street Journal reported on Monday. Representatives from the Organization of the Petroleum Exporting Countries, or OPEC, and its allies will meet this week to discuss options in the wake of the outbreak, which prompted the largest monthly crude-price drop in 30 years. China is also the world’s leading oil consumer.

Analysts also are closely watching the outbreak’s toll outside of China.

“[Over the weekend] there were signs the outbreak is slower outside of Hubei, and there have not been any major international outbreaks,” analysts at Cowen wrote on Monday. “However, new outbreaks often come in waves, and the numbers could also worsen going forward.”

European indexes were in the green Monday.

Before the outbreak, which has spread to 23 countries outside China, economists had expected global manufacturing to pick up at the beginning of 2020, in part due to the recent trade deal between Washington and Beijing.

But the outbreak is already sending spirals through the supply chains of American companies that rely on China for parts and materials. From consumer electronics to automobiles to medications, China is a major economic engine where production could grind to a halt until the public health crisis is under control.

So far, the White House has downplayed the threat. President Donald Trump’s top economic aide, Larry Kudlow, said last week that he expects the virus to have “no material impact” on the U.S. economy.

On Sunday, China’s central bank said it would inject 1.2 trillion yuan – roughly $173 billion – worth of liquidity into the markets. The Chinese yuan fell below 7 to a dollar, while commodity prices traded in Shanghai also fell sharply.

Many economic analyses point to the limited repercussions of the 2003 SARS epidemic. At the time, the Chinese economy bounced back relatively quickly when consumer spending returned to normal and businesses reopened. But China’s $14 trillion economy is four times as large as it was then and much more entrenched in global trade.

About 150 million Chinese business executives and tourists took an international flight in 2018, the most recent data available, more than seven times the 2003 figure, according to JPMorgan. Globally, the number of shipping containers moving among the world’s ports has almost tripled, according to the United Nations.

Yet the pandemic should only lead to short-lived disruption, instead of changing the market trend and the major outperforming sectors, according to a CITIC Securities report.

As a one-off shock, the epidemic is expected to cause a quick and deep market slump, followed by a slow bottoming-out, the report said, citing that the A-share market should be on an upward trajectory over the next two and three years driven by tech shares.

By 10:10 am, the SCI was trading at 2754 points, 7.5 percent below the closing price of the previous session on Jan 23.

The National Bureau of Statistics said on Monday that profits of China’s major industrial firms declined 6.3 percent year-on-year December last year, down from the 5.4 percent year-on-year expansion in November.

China’s industrial sector may see prolonged pressure in the near future as the coronavirus outbreak weighs on market demand and leads to the shortage of labor, analysts said.

But in the medium and long run, the industrial sector is expected to meet its recovering season as the fundamentals of the Chinese economy remain strong, they said.

The figure reflects a sluggish 1.88 percent growth in tourist arrivals from 2018, which recorded 15.81 million individuals entering the country, because of a significant surge in tourist arrivals in the summer season, which lasted between June and August, according to BPS data.

“We still have work to attract more foreign tourists to come into Indonesia,” said BPS head Suhariyanto during a press conference in Jakarta. The agency recorded a contraction of 2.03 percent of foreign arrivals in December last year, which saw 1.37 million foreign tourists.

According to BPS data, 9.8 million foreign tourists visited Indonesia by using airlines, followed by 4.1 million using sea transportation and 2.1 million using land transportation.

Suhariyanto said that Ngurah Rai Airport in Bali and Soekarno-Hatta International Airport in Jakarta saw the most foreign arrivals in 2019, recording 6.23 million and 2.41 million, respectively.

BPS data showed that in 2019, Bali recorded an increase in foreign arrivals of 3.55 percent compared to 2018, while Jakarta recorded a decrease of 14.05 percent compared to 2018. Meanwhile, Batam recorded 1.94 million of foreign arrivals through sea transportation in 2019, an increase of 3.21 percent.

Suhariyanto said Malaysia sent the most tourists to Indonesia, followed by Singapore and China in 2019.

“However, the coronavirus outbreak in China will no doubt lower foreign arrivals from China to Indonesia this year,” said Suhariyanto.

As of Monday, the coronavirus had killed 362, all but one in China, and had infected nearly 17,392 globally, surpassing infections caused by Severe Acute Respiratory Syndrome (SARS), the result of another strain of coronavirus that originated in China in 2003.

The Indonesian government declared on Sunday that it would ban all travel to and from China to prevent the spread of the deadly and highly contagious coronavirus.

The ban, which took effect at 12 a.m. on Monday, prevents visitors who have stayed in China for 14 days or more from visiting or transiting in Indonesia. The government will suspend visa-free and visa-on-arrival provisions for Chinese citizens.

The ministry is planning to hold a seminar to give knowledge about trade regulations with Britain after Brexit this March, so that Thai entrepreneurs are not affected by the changes.

Auramon Supthaweethum, director-general of the Trade Negotiations Department, said that the United Kingdom officially ceased to be a member of the European Union (EU) at 11 pm GMT on January 31, three and half years after Britain voted to leave the EU in a referendum.

From now until the end of 2020, it will be a transition period of 11 months for the UK to remain under British regulations but without voting rights. Both sides must hasten negotiations, establish trade and security agreements, in order to ensure smooth relations between the two sides when the UK completely leaves the EU on January 1, 2021.

Auramon said Britain’s exit from the EU will not have much of an impact on Thailand. There may be a slight fluctuation in the value of the pound. But trade between the UK and other countries, including Thailand, will continue as normal under old trade rules, as though the UK is still a part of the EU for at least until the end of the year. However, during this period the UK will hold discussions for a trade agreement between them. The Thai Trade Negotiations Department will follow up on these discussions to coordinate with relevant sectors and prepare for appropriate adjustments.

She said the department has closely followed the Brexit situation and was preparing measures to support any after-effects. In particular, there will be negotiations with both the EU and Britain on the amendment of the WTO tariff quota table for 31 products, including cassava, cassava flour, white rice, brown rice, broken rice, animal products, canned fish wings, etc for which Thailand has received quotas from the EU. It will have to allocate new quotas after Britain leaves the EU with the primary goal of preserving Thailand’s full quota. Both the EU and Britain have to allocate new quotas, which should not be less than what Thailand enjoyed while Britain was still an EU member as well as reflecting the actual trade volume between Thailand and the EU. Britain is Thailand’s 21st most important trading partner (second in the EU behind Germany), with trade in 2019 valued at $6.26 billion. Thailand enjoyed a trade surplus of $1.426 billion.

Closer relations with the UK after Brexit is, therefore, a matter of importance to Thailand. The department is currently studying the policies and measures that hinder trade and investment between Thailand and the UK. There are meetings scheduled to brainstorm opinions with the government and the private sector on February 7 and 13 respectively. When Thailand and the UK complete each other’s trade policy studies, both sides will go into the discussions to prepare a joint trade policy report. This will help pave the way for FTAs ​​to be created in the future.

In this regard, trade between Thailand and England in 2019 totalled US$6.260 billion, down by 11.04 per cent from the same period last year, with Thai exports to the UK worth $3.843 billion. Major exports include processed chicken, cars and equipment, electrical circuits, gems and jewellery, motorcycle machinery, etc. Thailand’s imports from Britain amounted to $2.417 billion. Major imports were machinery and components, electrical circuit boards, beverages, medical and pharmaceutical products, etc.

Anusorn Tamajai, director of the Economic and Business Research Centre at Rangsit University, warned that the impact of the coronavirus outbreak is expected to be significant as countries close borders, impose travel restrictions and businesses shut down factories in an attempt to contain the spread of China’s new coronavirus.

The death toll has crossed 300 while more than 14,000 patients worldwide are infected by the virus.

The impact will go beyond the tourism industry to manufacturing, exports and the agricultural sectors. It is likely to alter the global geopolitical setting, he warned.

Thailand exports agricultural products worth Bt900 billion to China annually. The impact of the virus outbreak is expected to reduce these exports by 1 to 2 per cent, he said. Five major farm products are: fresh, frozen and dried fruit worth Bt65.5 billion; rubber products worth Bt50.1 billion; tapioca products worth Bt42.3 billion; rice worth Bt9.3 billion and frozen chicken worth Bt6.9 billion. The anticipated export slowdown is expected to depress the prices of some farm products in the next few months, he noted.

As multinational firms close their plants and offices in China, the impact would be felt by supply chains worldwide in the fields of high-tech, electronics, auto and parts. For example, iPhone has announced the launch of a new mobile phone model. Import of raw materials in Thailand are also adversely affected and some factories have temporarily closed operations in Thailand. For example Sica New Materials (Thailand) has shuttered its plant in Thailand without advance notice or compensation to workers, he pointed out.

Retail businesses in Thailand would also be adversely affected, but e-commerce trade and logistics may expand, he said.

To shore up the Thai economy, the central bank would need to lower its policy rate to 1 per cent from 1.25 per cent currently, he said, pointing to the meeting of the Bank of Thailand’s Monetary Policy Committee this week.

He suggested that the Thai government may need to require Chinese tourists to apply for visas, which would let the authorities consider whether a particular tourist should be allowed to visit the country. Due to the delicate situation, travel restriction measures will likely impact relationships between countries, he acknowledged. An estimated million people are locked down in China and a lot of people may be angry with the Chinese government, he said.

The United States, Australia and Singapore have banned foreign nationals who have visited China in the past 14 days from entering their countries while Japan has banned foreigners who have visited Hubei province in China from entry into the country.

The World Health Organisation (WHO), however, has warned that travel bans will disrupt the global economy. The WHO, which on Thursday announced the outbreak of a global health emergency, also warned that a travel ban may not be effective in combating the coronavirus from spreading and people may go underground. It suggested that countries step up screening people to find infected people rather than imposing entry bans.

SEJONG — In the early and mid-2010s, the government’s yearly payouts for jobless people ranged between 3.3 trillion won ($2.7 billion) and 4.5 trillion won.

Amid moderate growth in the volume of unemployment benefits, the figure recorded 4.67 trillion won in 2016 during the previous administration, according to the Korea Employment Information Service.

But the situation began to change in 2017 in the aftermath of en masse business closures by self-employed people, who accounted for about 25 percent of all working people and now faced a tight job market.

KEIS data showed that unemployment benefits have continued to increase sharply over the past three years — reaching 5 trillion won in 2017, 6.43 trillion won in 2018 and an all-time high of 8.07 trillion won in 2019.

The 2019 figure marked a 72.8 percent (or 3.4 trillion won) surge compared with 2016.

Further, compared with five years earlier — in 2014, when benefits paid out amounted to 3.96 trillion won — the 2019 payouts constituted a 103.7 percent increase.

Government officials argue that unemployment benefits payouts rose in proportion to the rise in the statutory minimum wage.

But the rapid growth in payments since the early to mid-2010s could suggest a dire situation in the hiring market during the Moon Jae-in administration.

“Though there were some people who exploited the state-led payout system via shady securing of beneficiary eligibility, data indicated that a growing number of people have been forced to leave their workplaces in the wake of an economic slowdown in recent years,” said an employment research analyst in Seoul.

More recently, the KEIS data showed that the number of recipients has surged among South Koreans engaged in services such as food, lodging and tourism as business owners.

A year earlier, in December 2018, only 642 food retailers were paid unemployment benefits. But the number of recipients climbed rapidly in 2019 — to 5,272 in July, 6,032 in August, 6,653 in September, 7,656 in October, 8,546 in November and 9,785 in December.

The figure for lodging and tourism shot up to 2,234 in December 2019, compared with only 131 people a year earlier.

Though the KEIS explains that there could be difference in figures between net recipients and redundancy-included recipients, it is evident that the small-restaurant and lodging-tourism sectors represented a sharp contrast from other major jobs.

Market insiders share the view that the spike in the number of recipients in the food and lodging sectors demonstrates that self-employed people face greater difficulty due to drastic hikes in the minimum wage over the past two years.

For full-time salaried workers, the minimum wage climbed from 1.35 million won per month in 2017 to 1.74 million won in 2019.

According to a statement from the Ministry of Employment and Labor, the average recipient of unemployment benefits was paid 1.18 million won a month in 2017. That average monthly payment surged to 1.51 million won in 2019.

Recipients in their 50s accounted for the largest proportion at 26.2 percent, trailed by those in their 60s with 21.3 percent, those in their 40s with 19.4 percent, those in their 30s with 19.2 percent and those in their 20s at 13 percent.

The number of recipients of monthly benefits came to about 420,000 in December 2019.

Among the nation’s 17 major regions (provinces and major cities) nationwide, Gyeonggi Province had the greatest number of people on benefits, 113,000. Seoul was next with 80,400, followed by Busan with 33,500, South Gyeongsang Province with 28,200, Incheon with 27,200 and North Gyeongsang Province with 21,200.

On a yearly basis, the number of recipients totaled 1.45 million throughout last year — a record high — as compared with 1.33 million in 2018 and 1.21 million in 2017.

By Kim Yon-se (kys@heraldcorp.com)