Note:  In the future, we plan to publish this update on Monday, Wednesday and Friday each week, instead of every day. It has become less important to follow the data on a daily basis, not least because of the daily noise in the numbers. The trend is still important though and we intend to continue following up three times a week.

The bottom line is that Europe continues to see steady improvement. The US still has a high number of new infections but this is due partly to more testing. However, the number of new deaths is falling slowly and a number of the states that have started reopening still have a high number of new infections (e.g. Texas, Georgia). Brazil has seen a stabilisation but India and Russia saw new highs in new infections over the weekend. South Africa is also still on a rising path. Tensions are building between the US and China, with US Secretary of State Mike Pompeo's claim of 'enormous evidence' the virus came from a laboratory in China.

The number of new infections outside China continues to hover around 80,000 and has reached a total around 3.5 million. Europe continues to see a steady improvement, with the number of new deaths on a continued downward path.

In the US, the number of new infections is not really coming down but remains around 30,000. This is due partly to more tests but it seems also that while New York is seeing an improvement, many states still have a high level of new cases, not least Texas, Georgia and California.

Outside of the developed countries, Brazil has seen a stabilisation in the number of new infections following a period of a worrying increase. However, India, Russia and South Africa continue to see new highs in the number of new cases. Nigeria has seen a slight stabilisation. Growth rates are still quite high in Peru and Mexico.

US-China relations are under further strain, with US Secretary of State Pompeo stating over the weekend that there is 'enormous evidence' the virus came from a laboratory in Wuhan. China has vigorously denied the accusation and scientists have generally said it was unlikely, although not ruled it out as a possibility (Financial Times). Supposedly, discussions are taking place inside the White House on how to punish China and fears of a flare up in the trade war have come to the fore. See also Harr's View - The political disruption of the COVID-19 crisis, 3 May.

Stock markets are lower, with US equities down 2.8% and the S&P future losing a further 0.9% during the morning in Asia.

Comment

While Europe still looks quite positive and has room for gradual reopening, the picture is not as positive in the US and it is a concern to us that states are starting to open up before seeing a decisive decline in new cases. This poses a clear risk that the outbreak could gather pace again as the reopening unfolds. In our view, the tension between the US and China is unlikely to lessen and we could see some kind of US sanctions on China. We doubt Donald Trump will raise tariffs though, as this could put further obstacles in the way of a US recovery, a recovery Trump needs ahead of the US election. However, uncertainty in this area has clearly increased.

Read the original article on Danske Bank Research's website.