| The virus is back in China, data points to a slow recovery, and stocks fall. It's back China reported its largest daily increase in coronavirus cases since mid-April, with infections concentrated around Beijing's biggest fruit and vegetable supply center. Over 20 residential compounds across the capital were locked down by Monday as authorities move to contain the outbreak. In the U.S. the number of cases is rising in almost half of states, while in Germany the infection rate remains above the key threshold of 1.0. Economists at Morgan Stanley say that new outbreaks will be manageable as they double down on their call for a V-shaped global recovery. White House economic director Larry Kudlow said there is a "very good chance" there would be a quick recovery and that "2021 is going to be another solid, solid year." Fragile recovery Hopes for a rapid economic recovery in China were set back when data showed industrial output rose less than expected in May, while retail sales dropped by more than forecast. The reports suggested a gradual recovery being driven by stimulus measures rather than a resurgence in demand. Numbers for Europe showed that the bloc's trade balance in April plunged to a seasonally adjusted 1.2 billion euros ($1.35 billion) as authorities there move to counter China's global ambitions with an unprecedented tariff decision to counter the country's subsidies to exporters. Stocks fall Global stock investors are paring back any optimism over a V-shaped recovery as they seek safety this morning. Indexes across Asia and Europe are firmly lower and the dollar is rising with the mood firmly set to risk-off. The Stoxx 600 Index was 0.9% lower by 5:50 a.m. Eastern Time, while S&P 500 futures pointed to open below the 3,000 level. The yield on 10-year Treasuries was back under 0.7% and oil dropped. Protests There were fresh protests in Atlanta after police fatally shot an unarmed black man. The city's police chief resigned hours after the killing and the officer involved was fired. There were anti-racism rallies across the world over the weekend, with statues continuing to be a target for protesters. President Donald Trump spoke to graduating cadets at West Point on Saturday where he highlighted unity and America's core values. Coming up... Empire Manufacturing data for June is expected to show an improvement over the previous month, while remaining firmly in negative territory when the data is published at 8:30 a.m. Dallas Fed President Robert Kaplan and San Francisco Fed President Mary Daly speak later. U.S. April TIC flow numbers are at 4:00 p.m. The Chicago Board Option Exchange trading floor reopens. What we've been reading This is what's caught our eye over the last 24 hours. And finally, here's what Joe's interested in this morning It's been a disappointing year for Bitcoin. Here are six reasons why:
1. Despite the extraordinary market volatility, it hasn't surged to new heights. In fact, it continues to make a general trend of lower highs. This takes away the argument that an economic crisis creates a boom for Bitcoin.
2. Not only has it not soared, it's basically just gone in the same direction as the S&P throughout this volatility. Bitcoin rallied at the start of the year, then plunged during the crash, then rallied during the rebound, and it has been slumping over the last few days. This undermines the argument that Bitcoin has good portfolio diversification properties.
3. Bitcoin has performed roughly in line in this year with Ethereum, the next most valuable and liquid cryptocurrency. This undermines the argument that in has distinct "digital gold" characteristics that will separate it from other cryptocurrencies in a crisis. 4. The Bitcoin halving (a slowing of new supply) which many Bitcoiners championed as a likely catalyst for a move higher came and went without much impact.
5. The Fed has engaged in extraordinary balance sheet expansion, and governments around the world are running major deficits, and it hasn't led to the kind of inflation or currency collapse that many Bitcoiners would have predicted. So that undermines some of the popular stories about what would catalyze a Bitcoin boom. 6. Young people are discovering the stock market via platforms like Robinhood. So to the degree that people were putting money into Bitcoin because they liked volatility and action, there's a new competitor on the block for those dollars. 
The crisis may yet be good for Bitcoin, if in its wake we get infringements on privacy that create new demand for payments that can't be blocked. But in the meantime, all that's happened is that a bunch of popular Bitcoin narratives have been debunked.
Joe Weisenthal is an editor at Bloomberg. Like Bloomberg's Five Things? Subscribe for unlimited access to trusted, data-based journalism in 120 countries around the world and gain expert analysis from exclusive daily newsletters, The Bloomberg Open and The Bloomberg Close. | 
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