China’s latest COVID outbreak spooks investors, while U.S. cases and hospitalizations are rising again

April 26, 2022 in International

A fresh outbreak of COVID-19 cases in Chinese capital Beijing was dominating headlines on the pandemic on Monday as health officials reacted with extreme measures to prevent further spread.

Beijing started to test millions and shut down residential and business districts, after 47 cases were found since Friday, as the Associated Press reported.

The city’s more than 21 million residents began to stock up on food, anxious to avoid the shortages that hit Shanghai in recent weeks amid a strict lockdown. Long lines formed in supermarkets as shoppers purchased rice, noodles, vegetables and other food items, while store workers hastily restocked some empty shelves. State media issued reports saying supplies remained plentiful in Beijing despite the buying surge.

Shanghai, which has been locked down for more than two weeks, reported more than 19,000 new infections and 51 deaths in the latest 24-hour period, pushing its death toll from the ongoing outbreak to more than 100.

The central city of Anyang, along with Dandong on the border with North Korea, also announced lockdowns as the omicron variant spreads across the vast country.

“China’s zero-COVID policy may turn into a zero-growth policy,” said David Donabedian, chief investment officer of CIBC Private Wealth U.S., with $98 billion in assets under management.

“China’s economy had been growing, but lockdowns are weakening that economy and raising global concerns. China plays a huge part in the global supply chain, so closing factories and ports has created a shortage mentality that is front and center in the financial markets right now,” he said.

The news unsettled U.S. stock investors, coming at a time when cases have started to rise again in the U.S. after their steep decline early in the year, driven by the BA.2 variant, and two new subvariants that appear to be even more infectious. The two, named BA.2.12 and BA.2.12.1, were highlighted by health officials in New York State recently.

The U.S. is averaging 46,925 cases a day, according to a New York Times tracker, up 51% from two weeks ago.

Hospitalizations, which had also been steadily declining, are also ticking up. The country is averaging 15,642 hospitalizations a day, up 4% from two weeks ago, but still close to the lowest since the first weeks of the pandemic.

The daily death toll has fallen below 400 to 362, on average. The official U.S. death toll is expected to exceed 1 million within weeks.

Public health officials are concerned that the world is not going to meet the target set last year by the World Health Organization of getting 70% of the global population vaccinated by June, the New York Times reported.

The momentum has stalled as U.S. COVID funding has dried up, with only a handful of the world’s poorest countries, including Bangladesh, Bhutan, Cambodia and Nepal, reaching the 70% threshold.

The WHO has repeatedly warned that allowing the virus to run unchecked in major parts of the world creates the risk that new variants will emerge and that those could prove resistant to vaccines.

Here’s what the numbers say

The global tally of confirmed cases of COVID-19 topped 509.8 million on Friday, while the death toll rose above 6.21 million, according to data aggregated by Johns Hopkins University.

The U.S. leads the world with 81 million cases and more than 991,424 fatalities.

The Centers for Disease Control and Prevention’s tracker shows that 219.3 million people living in the U.S. are fully vaccinated, equal to 66.1% of the total population. But just 100 million are boosted, equal to 45.6% of the vaccinated population.