Coronavirus jitters push Asian markets down

14-Feb-2020 Intellasia | AFP | 6:02 AM Print This Post

Asian markets fell on Thursday after a dramatic spike in the number of coronavirus deaths and cases in mainland China, with traders concerned about the economic impact of the epidemic.

Chinese authorities have changed the way they count infections from the virusofficially named COVID-19and the latest reports propelled the nationwide death toll to 1,355 and the infection count to nearly 60,000.

Tokyo’s benchmark Nikkei 225 index closed 0.1 percent down, Hong Kong lost 0.3 percent, and Shanghai ended the day 0.7 percent lower.

Seoul dropped 0.2 percent, and Singapore lost 0.3 percent. But Sydney and Taipei were higher.

The new virus numbers dampened the positive cue from Wall Street overnight, where the three main indexes all set fresh records.

The jump in China coronavirus numbers “initially hit like a tonne of bricks given this is one of the market’s biggest fears”, Stephen Innes, chief market strategist at AxiCorp, wrote.

But he added that despite the “gnarly” headlines, the rise could be the result of a testing backlog being cleared over the weekend in Hubei province, where the virus emerged late last year.

In early European trade, London was down 1.0 percent, while Paris and Frankfurt both lost 0.4 percent.

Markets ‘jolted’

China has been praised by the World Health Organization (WHO) for its transparent handling of the outbreak.

There is, however, still scepticism among the global public, with suggestions that Beijing may be concealing the scale of the problem the way it did during the 2002-2003 SARS epidemic.

“Just when markets were getting comfortable with the idea that the COVID-19 infection increase was trending lower, the sudden jump in the number of new cases in Hubei has jolted them out of this sense of complacency,” Khoon Goh, head of Asia research at Australia & New Zealand Banking Group, told Bloomberg News.

COVID-19 has threatened to harm the Chinese economy, the world’s second-largest, with ANZ bank warning that China’s first-quarter GDP growth would slow to 3.2-4.0 percent, down from a previous projection of 5.0 percent.

In a Wednesday meeting, China’s top leadership called for efforts to minimise the impact of the outbreak and pledged measures to help firms deal with the economic fallout.

A day later, the ruling Communist Party fired two top-ranking officials in Hubei.

China is the world’s biggest importer and consumer of oil, and crude prices have been particularly sensitive to the epidemic.

The fresh jitters hit both main contracts on Thursday, which dropped after rising mid-week.

Brent Crude was down 0.8 percent and West Texas Intermediate was 0.5 percent lower.

Key figures at 0820 GMT

TokyoNikkei 225: DOWN 0.1 percent at 23,827.73 (close)

Hong KongHang Seng: DOWN 0.3 percent at 27,730.00 (close)

ShanghaiComposite: DOWN 0.7 percent at 2,906.07 (close)

euro/dollar: UP at $1.0880 from $1.0874

Pound/dollar: UP at $1.2979 from $1.2952

euro/pound: DOWN at 83.83 pence from 83.95 pence

Dollar/yen: FLAT at 109.78

Brent Crude: DOWN 0.8 percent at $55.36 per barrel

West Texas Intermediate: DOWN 0.5 percent at $50.94 per barrel

LondonFTSE 100: DOWN 1.0 percent 7,457.79

New YorkS&P 500: UP 0.7 percent at 3,379.45 (close)

New YorkNasdaq: UP 0.9 percent at 9,725.96 (close)

New YorkDow: UP 0.9 percent at 29,551.42 (close)


Category: FinanceAsia

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