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Stocks in Asia are tumbling continuously as the coronavirus continues to spread. This fall might be observed in the future as well until the spread is curbed.
The ongoing epidemic is still doing a strong and deep dive throughout the world’s financial markets. Generally, the coronavirus has caused stocks in Asia to plunge as panic continues to spread around the continent and even to the rest of the world.
Coronavirus Crashes Asia Stocks
Several markets across the continent are having a bad time of the event. The Hang Seng index, which covers the largest companies in Hong Kong, closed at 26,499.13 after losing 2.62%.
Most of the hardest-hit stocks all over the world have been travel or hospitality companies. Hong Kong is no different as some of these companies are continuously losing significant weight. The Cathay Pacific and China Southern Airlines are just two which lost 2.13% and 3.34% respectively. Others include a 5.35% plunge in Melco International Development and 5.21% in Wynn Macau as well.
Away from Hong Kong, Japan’s Nikkei 225 also closed at 22,977.75 after losing almost 2%. The Topix index also lost 1.48%, ending at 1,674.77.
Taiwan is no different. The Taiwan Weighted Index slumped almost 5.8%, closing at 11,421.74. The Hon Hai Precision, one of Apple’s major assembly plans lost a heavy 9.97%.
Data from South Korea also adds to the bad news as the Korea Composite Stock Price Index (KOSPI) lost 1.71%, closing at 2,148. Even tech giant Samsung Electronics lost 3.21%.
There are currently no data from Chinese markets as the governments extended the Lunar New Year.
Going Forward with Coronavirus on Stocks in Asia
It might make sense to suggest that the Chinese market will take a heavy plunge after it resumes. If other markets are already seeing heavy drops, it’s very possible that the same happens to China.
Already, the country’s National Health Commission has said that the death toll has increased to 170. In addition to that, confirmed cases have risen to 7,700 and are still expected to rise. With all of the apprehension, there is little to no faith in stock markets in Asia, until further notice.
Speaking to CNBC’s Street Signs, Pearl Bridge Partners’ Andrew Sullivan highlights the situation. Sullivan’s forecast suggests a bit more doom for a while until the situation sees some resolution:
“A lot of people have already moved into the very defensive areas that they can do. I think longer-term wise, we know the markets are going to recover, but nobody wants to…start jumping in until there’s some certainty there.”
At the moment, the number of confirmed coronavirus infection cases has already surpassed that of SARS. Back in 2003, the SARS epidemic took over 6 months to infect 5,000 people. With more than 7,700, there is currently no comparison.
The death toll is also rising steadily as 170 people have already died.
Some good news is that Chinese authorities say the SARS death rate was 7% while the coronavirus sits between 2% and 3%. Without any serious method for curbing its spread, this number could very easily increase.