Dow Inc. CEO Jim Fitterling expressed optimism Monday about the U.S. economy’s means to recuperate from the coronavirus, pointing to constructive symptoms coming from Chinese market.
“Our demand from customers is very good suitable now,” Fitterling advised CNBC’s Jim Cramer. “In fact, the final two months we’ve seen our need in China bounce back again.”
Fitterling, showing up on “Mad Revenue,” stated the corporation really started off to see the financial impacts from the coronavirus in China in early February, which was just after the government applied popular journey limits in endeavor to gradual the disease’s distribute.
“We have by now started to see a restoration from that,” he stated. “I believe that tells us that we can see the very same factor wash by way of the economic climate right here.”
The variety of coronavirus instances outdoors of mainland China is now bigger than the variety there, where the disease was found in late December.
There are additional than 181,000 scenarios globally. China has extra than 81,000 of them even though Italy is home to the 2nd-largest outbreak with extra than 27,000 conditions, according to info from Johns Hopkins University.
China’s Countrywide Wellness Commission reported there ended up 16 new confirmed instances of COVID-19 in China and 14 new deaths as of Sunday.
The U.S. has more than 4,000 verified situations of as Monday night.
Shares of Dow Inc., which will make chemical substances used in brake fluids and packaging resources, closed Monday at $22 just after falling 14.4%.
The inventory, like the broader industry, has taken a hit in modern weeks as trader issue grows about the financial repercussions of the coronavirus.
Dow’s stock is down 59.8% so far this yr. The S&P 500 sits additional than 29% off its February highs after it fell 11.98% on Monday.
The tumble in Dow’s inventory value has established a dividend produce of all-around 12%, Cramer stated.
Fitterling said the corporation has taken ample actions to guard its quarterly dividend of 70 cents because it was spun off from what is now DuPont de Nemours, Inc. final year.
For instance, the organization has paid out down practically $3 billion in financial debt, he said, and began the year with more than $2 billion in cash on hand.
“The market place is full of fear, uncertainty and question and they could project that on to the dividend,” he said. “It really is an artificially higher dividend generate. We’re in a much, substantially various money situation than we’ve been, and we did it deliberately to be completely ready to go into a down cycle after about a 10 to 11 12 months bull operate in this marketplace.”