Good morning. It’s a wash of red on the screens as global markets react to Jerome Powell’s bleak warning yesterday of an “uncertain” recovery. Investors are also bracing for more grim jobless numbers out before the opening bell.

Let’s take a closer look.

Markets update

Asia

• The major indices are all trading lower, led down by Japan’s Nikkei at -1.7%.
• Chinese investors are on the lookout for the first wave of convertible-bond defaults, a sign of a funding bubble forming in high-growth stocks.
• The COVID-19 pandemic could wipe out $8.5 trillion from global GDP and push 130 million people around the world into extreme poverty by the end of the decade, a new UN report concludes.

Europe

• European bourses sunk out of the gate. The benchmark Stoxx Europe 600 began the day down more than 1% with similar falls on London’s FTSE and Germany’s Dax.
• The eurozone needs an “ambitious” reinvestment plan to stave off a deep recession, European Commission president Ursula Von der Leyen detailed yesterday. She left out one key detail though: a price tag for that plan.
• After much squabbling, Italian lawmakers finally agreed to a €55 billion stimulus package to help struggling families and businesses. It’s long on promise (i.e., state aid to pay for babysitters and tax breaks for home repairs), but it’s riddled with red tape.

U.S.

• The Dow, S&P 500 and Nasdaq look set to drop at the open, extending yesterday’s losses.
• U.S. indices had one of their worst sessions in weeks after Fed Chairman Jerome Powell warned that “the path ahead is both highly uncertain and subject to significant downside risks.” 
• It’s Thursday, jobless claims day. The consensus estimate is that a further 2.5 million will have filed for unemployment in the past week. Goldman Sachs now sees the unemployment rate peaking at a staggering 25%, a big revision from the merely awful 15% rate it calculated last month.

Elsewhere

• Gold is up.
• As is the dollar.
• Crude too is climbing. Brent is again hovering just under $30/barrel.

Let my people go

Nobody likes lockdown. It’s doing a job on the economy, and, perhaps worse, it’s messing with our mental wellbeing, health officials say. Employers too are sounding the alarm.

But despite the many legal battles and state house protests to overturn stay-at-home orders playing out in the U.S., Americans are still wary of resuming normal activities—going to the movies, dining out, flying—any time soon.

Consider this latest piece of Gallup data, a poll conducted before the White House’s top disease expert, Dr. Anthony Fauci, testified about the dangers of prematurely easing lockdown measures. Two-thirds of Americans, Gallup found, believe it is “very important” that each of the following four “specific conditions is met before they are willing to return to their normal activities.”

The conditions include:

• mandatory quarantine for anyone who tests positive for the virus
• improved medical treatments for COVID-19
• a significant reduction in the number of new cases or deaths from the disease
• and the availability of a vaccine. 

From where I sit, I see little to no progress on meeting each of the four conditions above. Some—vaccines—could take more than a year.

Today’s chart (from Gallup) details the level of caution, broken down by political party. For such a divided country, there’s a fair bit of agreement about the merits of the go-slow approach.

States, not to mention countries around the world, are easing lockdown measures day by day. It will be a gradual process. You know what else will be a gradual process? Restoring public confidence in the economy.

***

Have a nice day everyone. I’ll see you here tomorrow.

Bernhard Warner
@BernhardWarner
Bernhard.Warner@Fortune.com

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