Global Stocks Stabilize After Deep Wall Street Selloff
Global stocks were mixed Tuesday while bond markets flagged continued fears among investors about the economic impact of the coronavirus outbreak after a sharp selloff a day earlier, reports The Wall Street Journal. Futures tied to the Dow Jones Industrial Average edged up 0.3% a day after the blue-chip index dropped more than 1,000 points, its biggest point decline in more than two years. The pan-continental Stoxx Europe 600 index dropped 0.4%, having fallen more than 3% Monday. The yield on 10-year Treasurys slipped to 1.364% Tuesday, on track to match the all-time closing low of July 8, 2016. The move signals ongoing concerns about a global economic slowdown as coronavirus cases emerge in new locations, prompting authorities to clamp down on travel and business activity to limit the contagion. Fixed-income investors have piled into haven assets including government debt in recent weeks, even as equity markets showed resilience in the face of the spreading epidemic. Read more here.
U.S. Traffic Deaths Decline for Second Year in a Row, Safety Group Says
Traffic fatalities on U.S. roadways reached an estimated 38,800 in 2019, the second consecutive year the country saw a small decline in road deaths, according to new figures released last week by the National Safety Council. According to Automotive News, the 2019 total represents a 2 percent decline from 2018, which saw slightly more than 39,400 road deaths, and a 4 percent decline from 2017, when about 40,230 people died in vehicle crashes, according to the Itasca, Ill.-based safety organization. While 2019 roadway deaths are down from the previous year, Lorraine Martin, CEO of the National Safety Council, said "38,000 deaths is still unacceptable." The group said it is still too early to determine the exact cause-and-effect trends behind the 2019 deaths. But final data from 2018 showed distracted driving and drowsiness continued to be factors. Read more here.
Colorado Bill Would Hurt Franchised Dealers
A bipartisan bill introduced this month in the Colorado legislature to allow any auto manufacturer to directly retail their battery-electric vehicles to consumers is a direct, frontal assault on state franchise laws — in Colorado and nationwide. An Automotive News editorial writes that if passed and signed into law, it would do grave and lasting damage to Colorado's franchised auto dealers. Notably, the bill was neither suggested by nor supported by the legacy automakers whose interests it purports to serve, and the fledgling bill is rightly opposed by the Colorado Automobile Dealers Association. It's a bad bill, without question. But its existence highlights the folly of maintaining one set of laws for one group of auto retailers while exempting latecomers simply because their products use a different energy source or their manufacturers want to make a go of it on their own. Legacy automakers have almost no interest in direct sales to consumers, in large part because they already benefit from the secret sauce of a franchised sales system: the ability to move their very expensive products immediately off their books as they leave the factory door. Read more here.
Ferrari Halts Tours and Closes Two Museums in Italy Over Virus Fears
Ferrari has suspended tours of its factory and shut down museums near its headquarters following the outbreak of coronavirus in Northern Italy, reports CNBC. Ferrari’s factory and headquarters are in Maranello, just south of the Lombardy region where a bulk of the more than 220 cases in the country are concentrated. Ferrari said it hasn’t halted production, but it has closed both Ferrari museums in Maranello and in Modena as requested by local authorities. It has also “restricted access for employees that are residents or have visited the affected municipalities,” and has suspended visits from tourists — including its popular factory tours -- as well as “all non-critical business travel.” The company said “new measures will be promptly implemented and communicated should they become necessary.” Ferrari’s share price fell by about 5% Monday after reports of the outbreak, mostly in Italy’s Lombardy region, which includes Milan. A dozen towns went into effective lockdown, closing schools, businesses and restaurants and canceling public events. Ferrari produced over 10,000 cars at its Maranello factory and Ferrari fans around the world make the pilgrimage to the factory and museum for tours. Read more here.
Nissan Warns About Future of European Plants as Brexit Weighs
Nissan Motor Co. gave the starkest warning yet on the future of the Japanese group’s car factories in western Europe, with a plant in the U.K. threatened by Brexit and another in Spain suffering from a slump in demand, reports The Detroit News. The Sunderland site in England, which makes models that account for the bulk of European sales, remains under a cloud of uncertainty, Gianluca de Ficchy, chairman of Nissan Europe, said Monday in a press conference near Paris. Should Britain fail to reach a free-trade agreement with the European Union, a resulting 10% tariff on cars and parts could not only spell the demise of the plant, which sends about three-quarters of its output to the continent, but also of Nissan’s entire European strategy, the executive said. “We would not be viable,” he said. “We just wouldn’t be able to sell our cars.” Read more here.
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