Asian Shares Dipped on Increasing Fears on Coronavirus

BEIJING, China – Stocks decline on Monday in the few markets open in Asia amid China announcing a sharp increase in the number of people affected by the epidemic of a possibly deadly virus.

In celebration of the Lunar New Year, many regional markets in Asia, including China, were closed. The Australia stock market was also closed for the Australia Holiday. Meanwhile, with the few stock markets open in Asia, Monday’s session was on a downward trend from its previous close on Friday.

The Nikkei 225 index in Japan dipped to around 1.8% towards 23,389.49 points. The benchmark index in Thailand went down by a heaping 2.2%, while the Sensex index in India dropped to 0.4% towards 41,466.45 points. The benchmark share in Indonesia also declined by 0.8% for the day.

On the other hand, China announced a three-day extension for its week-long public holiday as a precaution against the fear of the coronavirus spreading even further. By Sunday midnight, the National Health Commission stated that from a record of 2,744 confirmed cases, 80 already died of the virus.

The virus outbreak and the fear of the people about it spreading even further had impacted not only the trading session on Monday but the tourism and the internal movement of the country as well.

Several governments have already announced their plans to evacuate people from the central Chinese city Wuhan, which is also the center of the pandemic. The Chinese government has already ceased outbound tours, while Wuhan and other cities in the country halted public transport. The recent move of the government obliged around tens of millions of people to remain wherever they are during the peak travel season in China.

Meanwhile, the World Health Organization hasn’t declared the outbreak a global emergency. The declaration from the WHO would bring more money and resources to help fight the outbreak, although it would also trigger restrictions on travel and trade that will largely affect the economy.

According to Stephen Innes from AxiCorp, traders are mainly focused on the country’s mortality rates early on trade. He said that aside from the recent headline’s direct impact on travel and tourism, any economic shock in the country will likely spread quickly in other countries due to China’s increased trade and financial connections.

The recent news of a Chicago woman diagnosed by the coronavirus from China also caused a sell-off in the health care stocks in the US, which triggered the S&P 500 to drop 0.9% to its worst day on Friday since early October.