The daily business briefing: February 13, 2020

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Harold Maass
A temperature check in Shanghai
NOEL CELIS/AFP via Getty Images

1.

Confirmed coronavirus cases soar as China changes diagnostic rules

Chinese public health officials on Thursday reported a huge increase in the number of coronavirus cases in Hubei province on Thursday. The 14,840 new cases, lifting total infections to about 60,000, marked a 10-fold increase over the number reported on Wednesday. The 242 new deaths more than doubled the most recorded in a single day. It was not immediately clear what the figures indicated about how fast the flu-like virus was spreading, because the spike came after the health commission in Hubei, the epicenter of the virus, changed its diagnostic criteria for confirming cases, giving doctors more discretion. Still, the news cooled hopes that the spread of the epidemic was slowing, halting a rally in Asian markets. [South China Morning Post, Reuters]

2.

Senators urge Powell to stand firm as Trump criticizes Fed

Republican and Democratic senators urged Federal Reserve Chair Jerome Powell to keep the central bank independent. President Trump has called Fed policymakers "boneheads" and accused them of hurting the nation's economic growth by raising interest rates too high and lowering them too slowly. Trump slammed Powell again via Twitter on Tuesday, but Sen. John Kennedy (R-La.) urged Powell to tune out critics and "Stay independent." "I think you're doing a great job," Kennedy added during Powell's appearance before the Senate Banking Committee. "All of us in politics are going to give you advice, but call 'em as you see 'em." Sen. Mark Warner (D-Va.) said many other government institutions, including intelligence agencies, have come "under assault" from the Trump administration. [The Associated Press]

3.

Deficit rises 25 percent in first 4 months of fiscal 2020

The federal deficit hit $389.2 billion in the first four months of the 2020 fiscal year, a 25 percent increase over the same period the previous year. The shortfall over those four months is already roughly 40 percent of the entire 2019 deficit of $1.06 trillion. The government is bringing in more, with receipts totaling $1.18 trillion through January, up from $1.1 trillion in the same period a year earlier. But spending is up by more, hitting $1.57 trillion in the first four months of the new fiscal year compared to $1.42 trillion last year. President Trump has said economic growth would pay the cost of his tax cuts, but GDP growth slowed from 2.9 percent in 2018 to 2.3 percent in 2019. [CNBC]

4.

U.S. stock futures fall as hope of slowing coronavirus spread evaporates

U.S. stock index futures dropped early Thursday as a spike in newly reported coronavirus cases in China dampened hopes that the spread of the outbreak was slowing down. Futures for the Dow Jones Industrial Average, the S&P 500, and the Nasdaq were down by 0.7 percent or more several hours before the opening bell. Wall Street hit record highs on Wednesday after two days of falling coronavirus infections soothed fears of economic fallback from the epidemic. The Dow jumped by 275 points, or 0.9 percent. The S&P 500 and the Nasdaq closed up by 0.6 percent and 0.8 percent, respectively. [CNBC]

5.

Barclays says U.K. investigating CEO's links to Epstein

Barclays said in a statement Thursday that its American chief executive, Jes Staley, is under investigation by British regulators over old ties to disgraced financier Jeffrey Epstein. Barclays said Staley last year told the British lender's chairman Nigel Higgins and other executives that earlier in his career he had a professional relationship with Epstein, a financier who hanged himself in his Manhattan jail last year awaiting trial on sex trafficking charges. Barclays' board said Staley still had its confidence because he appeared to have been "sufficiently transparent with the company as regards the nature and extent of his relationship" with Epstein, and had no contact with him after taking over as CEO in 2015. [CNN, MarketWatch]