The boss of one of Europe’s largest insurers Legal & General played down the threat of coronavirus on Wednesday saying the issue was not a full-blown crisis for the economy.
Nigel Wilson, chief executive of the £16 billion FTSE 100 company, suggested markets had overreacted to the global sweep of the virus and compared the panic to similar market blow-ups like the Millennium Bug in 1999 and Brexit in 2016.
He said Chinese manufacturing looked to be coming back onstream after its coronavirus shutdown, which boded well for the future.
“I don’t think it’s a major risk to the global economy,” he said. “The economy moves up and down and markets move up and down. That’s going to continue for 30 or 40 years like it has the past 30 or 40 years. Will GDP fall [because of coronavirus]? Yes. Will it come back in the second half of 2020 or 2021? Yes.
“They cause temporary dips but in the long term there are amazing opportunities in the economy and we have to seize those opportunities.” Legal & General is heavily exposed to death rates because it sells life insurance policy.
Wilson said coronavirus would have “minimal or no impact” as deaths from it were so small. Legal’s full-year operating profit rose 12% to £2.1 billion for the year ending December.
In more corona news: the 10-year US Treasury yield, considered the safest asset on earth, slumped below 1% for first time in its 150-year records after the Federal Reserve’s emergency rate cut.
Markets in Asia and Europe stabilised with US stock markets expected to rise as Joe Biden’s surprise comeback on Super Tuesday blunted investors’ fears Bernie Sanders may win the Democratic nomination;
Anglo American’s De Beers said diamond sales had dropped due to problems in the Chinese markets, with customers deferring rough diamond shipments until the crisis blows over.
