Stocks Fall as Dangerous Coronavirus Spreads

The sheer size of the Chinese economy makes any upheaval there a serious factor in the pace of worldwide economic growth. Creeping doubts among investors have already helped drive down bond yields in recent weeks. And on Monday, the yield on the 10-year Treasury note, considered a gauge of investor expectations for economic growth and inflation, sank to 1.61 percent, the lowest level of the year.

But as long as the spread of the virus remains contained, the economic implications shouldn’t be dire for the United States.

The American economy is relatively insulated from trade, and the important consumer sector is showing signs of ongoing strength. Unemployment remains near 50-year lows and economic growth, while relatively slow, is steady. Inflation and interest rates are low, with signs that those low rates are finally starting filter through to the broader economy.

With rates on 30-year fixed mortgages below 4 percent, housing has recently picked up the pace. Sales of previously built homes are at their highest level since early 2018. Home builders are reporting strong demand for more affordable offerings.

Article source: https://www.nytimes.com/2020/01/27/business/stock-market-today.html?emc=rss&partner=rss