Trump's 'foreign virus' speech underwhelms traders

WASHINGTON • The America First presidency collided with a global pandemic on Wednesday night. The result did not appear to reassure skittish markets or a nervous nation.

United States President Donald Trump relied on a familiar playbook as he spoke in a prime-time address from the Oval Office, announcing sweeping new restrictions on travel from Europe and scattered executive actions to help workers and businesses rocked by what he labelled a "foreign virus".

He blamed allies for not adopting tough immigration measures that he said had prevented a wider outbreak in the US.

But the combative approach and small-bore measures seemed only to highlight the President's struggles to confront the most consequential moment of his presidency.

And even in a 10-minute address, Mr Trump could not stick to the facts. He overstated the European travel restrictions, saying he was "suspending all travel" from the continent, and suggested that they would also apply to trade.

He tweeted later that trade would not be affected, and the Department of Homeland Security clarified that the restriction applies generally to foreigners who have been in Europe within 14 days.

He said US health insurers had agreed to waive co-payments for coronavirus treatment.

A spokesman for trade group America's Health Insurance Plans said its members had agreed only to waive co-payments for testing.

The speech clearly underwhelmed investors, who have been waiting for a "major" economic plan that the President promised on Monday and has yet to put to paper.

Futures on the benchmark S&P 500 index steadily deteriorated as details of Mr Trump's plan leaked out over the dinnertime hours in New York.

Down about 0.8 per cent when his remarks began, the loss extended to 2 per cent by the time the President finished speaking and got worse from there.

"Investors are looking for bold government stimulus. So far we haven't seen a lot of detail and there isn't much confidence it will happen quick enough," said Mr Nathan Thooft, Manulife Investment Management's head of global asset allocation.

Mr Trump's most ambitious proposals include a suspension of US payroll taxes, paid sick leave for hourly workers and US$50 billion (S$71 billion) in additional loans for small businesses.

Both Democrats and Republicans expressed reticence about a payroll tax cut, and about three hours after his address, House Democrats released their own plan to fight economic fallout from the virus that served to highlight how modest Mr Trump's offering sounded.

The Democratic plan includes free coronavirus testing, paid emergency leave for workers, food security assistance and other measures to help ordinary Americans weather the outbreak.

The address demonstrated that for the President, the coronavirus remains a foreign problem that can be resolved with a characteristically Trump approach: Closing US borders. He hardly acknowledged the spread of the virus within the country, where there are now more than 1,300 cases and 38 people have died.

"We are moving very quickly, and for the vast majority of Americans, the risk is very, very low," Mr Trump said, once again describing the threat in more optimistic language than what the US health authorities use.

"Young and healthy people can expect to recover fully and quickly if they should get the virus," he added.

Mr Trump appealed to Americans to wash their hands and stay home if they are ill. He said nothing about the US delay in testing potentially infected people that has left public health authorities blind to the spread of the disease.

"Testing and testing capabilities are expanding rapidly, day by day," the President said.

But beginning within minutes of Mr Trump's address, events rapidly demonstrated the extent of the crisis. The American movie star Tom Hanks and his wife, actress Rita Wilson, announced that they were infected, and the National Basketball Association suspended its season after Utah Jazz star Rudy Gobert tested positive for the virus.

Twitter told all of its employees to work from home.

Senator Maria Cantwell, a Washington State Democrat, said a staff member in her Washington office had tested positive for the virus.

The crisis has gone to the heart of core, unresolved questions about Mr Trump's presidency: whether his streak of economic growth could be maintained through Election Day, if he could suppress his penchant for bold proclamations and political warfare as experts issued dire warnings about the disease, and how a West Wing staffed by novices and defiant outsiders would navigate the complexities of a true crisis.

Early reviews - based on both public opinion and the reaction of financial markets that Mr Trump himself has called the best barometer of his success - have not been kind.

Just 43 per cent of Americans approve of the President's handling of the outbreak, while 49 per cent do not, according to a Quinnipiac University survey released on Monday.

And only 41 per cent of Americans approve of Mr Trump's overall job performance, with a majority - 54 per cent - disapproving.

BLOOMBERG