Monday, February 3, 2020

Coronavirus Fears See $400 Billion Wiped Off China’s Stock Market

Isabel Togoh Forbes Staff Feb 3, 2020, 06:36am
Topline: Chinese markets closed nearly 8% down on the first day of trading since the extended Lunar New Year holiday over fears of the coronavirus, and measures taken to control the fast-spreading pneumonia-like virus.
·         China’s benchmark stock index, the Shanghai Composite, saw its worst day since August 2015. It closes nearly 7.72% down in a $393 billion share sell off that saw the majority of stocks suspended after hitting the 10% daily volatility limit.
·         The fall came despite efforts by China’s central bank to ease the impact of the virus on the world’s second largest economy with a $173 billion package announced on Sunday to provide liquidity in the banking system, and currency market .
·         Hong Kong announced on Monday all but three borders checkpoints with the mainland China would close on Monday, while many workers in the Asian financial hub have been told to work from home. Many expat families have temporarily left, according to Reuters
·         Some hospital workers in Hong Kong have called a strike to press the city’s government for a total travel shutdown mainland China, following the suspension of rail and ferry links last week.
·         Some 17,000 people are infected with the pneumonia-like illness across 30 countries, mainly in China, while 362 have died, including one person in the Philippines. Medical experts in Hong Kong say that the actual number of infections in Wuhan could be higher
·         Several countries are now denying entry to visitors from China including the U.S. Last week, the U.K., U.S., Japan and Australia were some of the countries to evacuate their citizens from Wuhan, the central Chinese city at the heart of the outbreak.
·         Several countries are contributing towards expediting a vaccine for the strain, formally known as 2019-nCoV. British drugmaker GSK is collaborating with the Norway based Coalition for Epidemic Preparedness Innovations to develop one, while the British government has donated $26 million (£20 million) to CEPI’s efforts. Germany and France expect to develop a vaccine within months.
Key background: Last week, the number of new coronavirus cases overtook the SARS outbreak in 2002-2003, in which 8,000 people were infected. The impact of the coronavirus could overshadow SARS given that China’s GDP has exploded from $1.6 trillion in 2003 to $13.6 billion today as China became the world’s de facto manufacturing hub, while travel links with the rest of the world have grown dramatically. In a bid to curb the spread of the new virus, which broke out in a Wuhan food market in December, the Chinese government has put millions of people across the worst-hit cities on lockdown in an unprecedented quarantine operations. Several airlines have suspended flights to China while the Trump administration’s travel ban for foreign nationals who visited China in the last 14 days kicked in on Sunday evening. The World Health Organization has advised against travel restrictions, with the director general Tedros Adhanom Ghebreyesus saying on Friday that such measures are not necessary.
Although it is spreading quickly, much about the virus remains unknown. It is thought to be transmitted through infected droplets from coughing and sneezing, while symptoms include fever and in severe cases, pneumonia, kidney failure and death.
Surprising fact: Wuhan authorities have scrambled to build two specialist hospitals, with the first 1,000-bed facility opening its doors to patients on Monday. But it is likely to be overrun with patients, much like other facilities in Hubei province that are struggling to cope with the sheer demand for care. Patients are reportedly waiting 10 hours to see a doctor, while some are facing medical supply shortages. 

https://www.forbes.com/sites/isabeltogoh/2020/02/03/coronavirus-fears-see-400-billion-wiped-off-chinas-stock-market/?utm_source=newsletter&utm_medium=email&utm_campaign=daily-dozen&cdlcid=5d1670731802c8c524c78889#76e24fb74464

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