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Weekly Wrap: Davos 2020, China Virus Outbreak, India’s Growth Forecast Cut

Weekly Wrap: Davos 2020, China Virus Outbreak, India’s Growth Forecast Cut

| Updated: February 20, 2020 15:24 IST

Snow rests on top of a stone bear sculpture outside the Congress Center ahead of the World Economic Forum (WEF) in Davos, Switzerland. (Photographer: Jason Alden/Bloomberg)

The world's elite gathered for the World Economic Forum annual meeting at Davos, Switzerland. The outbreak of a SARS-like virus in China's Wuhan city, which is now in lockdown. The International Monetary Fund lowered growth estimate for India.

Here's what happened in the business world and across the globe between Jan. 20 and Jan. 24...

China Virus Outbreak

China's mysterious respiratory virus killed more than 20 people and affected hundreds. Healthcare workers contracting the new illness indicates that it's more easily transmitted than previously thought, bringing the outbreak to a higher risk level.

The number of confirmed cases in mainland China, according to the National Health Commission, rose to 830 as of Jan. 23. That includes 177 cases in severe condition and 25 deaths. Wuhan, the central Chinese city that's ground zero of the deadly new virus, is now in a lockdown, with public transport halted, flights cancelled and trains not running right.

Why China's Mystery Illness Is Reviving Fears of SARS

IMF Cuts India Growth Forecast

The International Monetary Fund lowered growth estimate for India to 4.8 percent for 2019, citing stress in the non-bank financial sector and weak rural income growth. It expects growth to be 5.8 percent in 2020 and rise to 6.5 percent in 2021.

The IMF also expects the world economy to strengthen in 2020, albeit at a slower pace than anticipated amid threats related to trade and tensions in the Middle East. Global growth will accelerate to 3.3 percent from 2.9 percent in 2019, marking the first pickup in three years, it said.

WEF 2020 At Davos

The 50th World Economic Forum annual meet kicked off at Davos, Switzerland this week. Leaders of various countries, top investment bankers, companies' management and economists gather at the snow-covered ski resort town to discuss the future of the global economy.

Also, for the first time in its history, the forum welcomed teenage change-makers to its annual meet.

Here's BloombergQuint's coverage of WEF 2020:

Tech cold war can turn internet into ‘Splinternet', says John Chipman
Why Baba Kalyani thinks the worst is over for the auto sector
Phase 1 of U.S.-China trade deal won't solve problems, China reform foundation's Fan Gang says
Ian Bremmer says India's image has taken a hit from Modi's nationalist policies
Fatih Birol on the one big risk to an otherwise stable oil market
Adair Turner says India shouldn't tell itself ‘silly stories' about demographic dividend
Historian Adam Tooze explains why protests are an integral part of democracy
SpiceJet to see improved cash flow in last four months of 2020 after Boeing 737 Max returns, says Ajay Singh
M&M's Anish Shah likens company to Berkshire Hathaway, says spinoffs ‘artificial step'
Don't see too many ‘big bang' deals in future, says Tech Mahindra's CP Gurnani.
Priyanka Chopra Jonas' message to the world's 2,153 billionaires
Sanjiv Bajaj sees ‘some uptick' in consumer lending business
Bharat Krishak Samaj's Ajay Vir Jakhar calls for scrapping crop insurance scheme, Essential Commodities Act.
Asia bagged half of world's investment in the last decade, says McKinsey's Oliver Tonby
M&M upped internal volume forecast thrice in Q4, says Pawan Goenka
How Piramal contains NPAs despite a large exposure to real estate
Anand Mahindra says Indian Economy undergoing ‘detoxification'
In a first, World Economic forum invites 10 teenage change-makers
Lower growth, higher debt, weak investments—Zhu Ning on the China story
Not just India, the NBFC problem exists across nations, Says Bain Capital's Steve Pagliuca
GSMA's Laxmi Akkaraju says India must step up efforts to help telecom firms move towards 5G
Nielsen's David Kenny says people are willing to pay more for news than entertainment

How Markets Fared This Week

Indian equities halted their two-week gaining streak as investors booked profit.

The Sensex fell 0.79 percent during the week to close at 41,613.19, while the Nifty 50 Index dropped 0.8 percent to 12,248.25.

The volatile week, which ended on a negative note, started with profit-booking after a selloff in heavyweights, Santosh Meena, senior analyst at TradingBells, said in an emailed statement. “The markets, however, witnessed a decent recovery in the last two days.”

The markets, Meena said, would be dominated by the Union budget next week. “It has a lot of expectations from this budget amid an economic slowdown and it's being said that this budget could be different because Prime Minister Narendra Modi himself was aggressively involved in drafting the budget,” he said.

According to Meena, there's a need for steps to get back confidence in the Indian economy. “Finance Minister may announce a cut in personal income tax, which will help to boost consumption in the economy.”

Seven of the 11 sectoral gauges compiled by the NSE ended lower this week, led by a 2.4 percent fall in the NSE Nifty Metal Index. The NSE Nifty Realty Index was the top gainer, up 1.4 percent.

How Broader Market Fared

The broader market, represented by the Nifty 500 Index, fell 0.35 percent during the week. That was led by a drop in shares of Edelweiss Financial Services Ltd., Reliance Power Ltd. and Gayatri Projects Ltd.

How The Currencies Performed

The Indian rupee weakened against the dollar for the second straight week. The domestic currency depreciated 0.34 percent against the greenback to 71.33.

Big Talking Points This Week

India's air passenger growth falls to lowest in six years during festival quarter.
What will it take to save Vodafone Idea...
Billions of dollars may come for India stocks after rule tweak.
India's painful double whammy grips more emerging markets.
Saudi Crown Prince hacked Jeff Bezos's phone, analysis suggests.
Telecom Department directs officials not to act against telecom companies on AGR non-payment until Supreme Court hearing.

Key Events To Watch Next Week

Jan. 31: India to release eight infrastructure industries data for December.
Jan. 31: India to announce GDP annual estimate data for 2019.
Jan. 31: India to release economic survey data.
Feb. 1: Finance Minister Nirmala Sitharaman to present Union Budget for 2020-21.

Key Earnings Announced This Week

Earnings To Watch Next Week