As of Friday, most markets are continuing their downturn over the plague of Covid-19 as new large and small outbreaks hit in more countries. There are locusts devouring east African crops. California and Australia suffered hail and firestorms. China suffered huge livestock deaths from swine flu. Rivers turned blood-red in Malawi and Indonesia last year. The slaughter of the first-born may be next, which means my husband, my daughter and me. We must free our slaves, if we have any.

China has again shifted its reporting criteria after an outbreak in prisons. As discussed below, a huge outbreak has hit South Korea. Israel and Lebanon each reported their first infections. 

“Something doesn't smell right.” Under that header, on Friday, BofA Global Research spelled out that global, and Asian growth momentum fell over US trade policy last year, well before the virus hit, and it was deeper and more persistent “than most pundits believe” (except BofA's that is.) It cited bad news from Chile to Germany, from China to emerging markets, all of which went into slowdown mode in 2019 over trade and tech wars. Job openings even fell in... Trumplandia, the USA, in Dec. and Jan.

Flying High

 *The latest risks in Boeing 737-Max planes is grit and debris in fuel tanks and a malfunctioning warning light, both which will further delay the Max's return to the air. I have a stock for that, and in case you haven't guessed, it is not Boeing (BA) itself. (I made my account manager for my US portfolio sell Boeing, easy to do as he's my son the Certified Financial Analyst.)

The winner is already showing take-off capacity as its earnings and revenues have been rising in the current year, which in this case ends March 31. The stock is from Montreal and makes flight simulators, devices used to train pilots. There is a huge backlog in pilot training for the Max, but delays will make it easier for our company to get ready for the relaunch, now likely to be late this year. It has a sideline in training medical personnel.

My company pick is CAE Inc. (CAE) whose sales in the 1st 9 months and the key reason for buying it is that thanks to some takeovers and huge demand for pilots (both civil and military), it is growing its market share, order backlog, and profits. It pays a meager dividend, although it has raised it to all of 1.1% now in every year since 2007. Patti the Biotech Maven (a pilot's mother) first discovered this stock for us.

Tech & Tel

*Nintendo (NTDOF) is down over 1% today, not because Abhimanyu Sisodia did not make the case for its gaming strategy, but because of Yen (FXY) weakness as the plague is hitting Asian countries with a vengeance.

Energy

*Schlumberger Ltd (SLB) filed its proxies for its annual general meeting which will take place on April 1. In France you try to stick a picture of a fish on unsuspecting people on April Fool's Day. SLB is Dutch Antilles incorporated but its major (family) owners are French. SLB is down with the oilpatch today, and has lost a quarter of its value in the last year. I am a very old owner, having bought when I wrote the company up for The Economist in 1964 when living in Paris.

*Royal Dutch Shell (RDS-B) is off 1.7% because of flu cutting oil demand.

*BP plc (BP) is down 1.6% because of flu.

*Brazilian sugar and ethanol producer Cosan Ltd fell a further 2.5% today in Europe. I sold after it issued its results in Portugues, finally getting a payback from all those courses at the Fundacao Gulbenkina.

*Algonquin Power (AQN) is up nicely.

*Ditto for Azure Power (AZRE). Both we put into the portfolio as green stocks, but they are proving to be good anti-virals.

Drugs

*The high price of drugs is going to be part of the Democrats' attack on Trump no matter who the candidate may be. To prepare for this, Israeli Teva (TEVA) today issued a ginormous SEC document on its business which is mostly generics, cancer and neurological medicines.

*Eisai is one of the few winners in Japan because it sells worldwide. If the Biogen (BIIB) Alzheimer's drug works out (a big if despite Warren Buffett voting yes), ESALY will benefit along with the oldest population in a developed country

*Canadian Bausch Health Cos (BHC) fell yesterday on no reason I could find. It turns out that the consensus eps estimate for the current quarter was chopped by over a US penny to 9.35¢. BHC forecast sales this year of $8.65-8.85 bn and adjusted earnings before interest, taxes, depreciation, and amortization of $3.5-3.65 bn. Its shares rose by over 60% last year. BNC is the former Valeant, a rogue pharma shop, and there are always people to remind us of this. It opened the year at $30 and is now at around $26.

*Fellow Canadian Zymeworks is down nearly 1% over its secondary share and warrants offering. I think its cancer drug products ZW25 and ZW 49 are worth holding, as do the buyer of its warrants, T. Rowe Price, Fidelity, and Franklin funds, Goldman Sachs, Deutsche Bank, UBS, Crédit Suisse, Royal Bank of Canada, BofA-Merrill, etc. Most of the institutions are buying warrants, more common in foreign markets than in North America.

Funds

*Korea Fund is down over 1.1% today after an outbreak of corona virus among followers of an evangelical Christian group which met in a provincial city, Daegu. There are now 204 South Koreans with the virus, and two who have died, and the number is growing fast.

*We are not the only ones selling Western Asset Management (EMD) funds in anticipation of their being managed by Franklin Templeton (BEN). The global emerging market debt fund we sold, EMD is down but its discount from NAV is less after the news of a takeover hit.

*Also under the gun from specialists in CEF's are funds from Wells Fargo (WFC) with high nominal rates of return, because they used return of capital to lure in their customers, who were also cheated by creating false brokerage accounts for them. To settle with the SEC Wells is paying about $3 bn today, and it also incurred costs by hiring lots of new staffers. Given the rush to combine investment banks and regular banks on Wall Street, Wells became a target as its stock price fell 14% in the last year, and today, fine-paying day according to the Wall St. Journal, WFC is up. Other funds do this too, but Wells overdid it.