U.S. Stocks Drop on Coronavirus's Economic Impact

WSJ-- "Stocks and Treasury yields dropped Friday as precious metals rallied on early signs of the coronavirus outbreak curtailing economic growth in some markets. U.S. stocks are on track for declines this week, while traditionally safer assets like gold and government bonds are headed toward gains. The concurrent gains in precious metals and government bonds this year have highlighted the jitters that have percolated markets even as major U.S. indexes are sitting close to their records. Typically, investors ditch haven assets like gold and government bonds as stocks crest to fresh highs. Some analysts have attributed the rush for haven assets to the viral outbreak. 'If we are in an environment when we will see a lower-than-expected growth on the back of coronavirus, this will increase demand for low-risk assets,' said Andrey Kuznetsov, a senior credit portfolio manager at Hermes Investment Management. Investors may be underestimating the impact of the outbreak on U.S. companies' earnings as economic activity slows in China and tourism takes a hit, Goldman Sachs Group warned. More than 75,000 people have been diagnosed with coronavirus, and over 2,000 have died globally. The worries about the coronavirus come as manufacturing data has continued to disappoint....'In the grand scheme of things, we kind of read this as the calm before the storm,' said Aila Mihr, a senior analyst at Danske Bank Research. 'We don't think we have seen the worst yet.'"