Asian markets yesterday bounced back on bargain-buying following the previous day’s sharp losses, but investors remained on edge after a deadly virus from China was to have spread to the US.
Global equities took a severe hit on fears the new outbreak could cause as much economic damage as the SARS epidemic that killed hundreds of people in 2003.
Shanghai dived more than 1 percent in early trade, extending the previous day’s 1.4 percent drop, with authorities battling to contain the 2019-nCoV strain as China prepares for the Lunar New Year holiday, when millions of people travel across the country.
However, Chinese shares performed a U-turn to end the day with gains.
Tourism-linked firms — which had been hit by concerns about the disease’s effects on the global economy just as it shows signs of a tentative recovery from a long-running slowdown — also enjoyed a reverse.
After a sell-off in Asia on Tuesday, news that the US had reported its first case hit Wall Street, with the Dow Jones Industrial Average and S&P 500 sinking from record highs.
Fears of a bigger outbreak rose after a prominent expert from the Chinese National Health Commission on Monday confirmed that the virus can be transmitted between people.
The WHO was later yesterday to hold an emergency meeting to determine whether to declare a global public health emergency over the disease, which has also been detected in Taiwan, Thailand, Japan and South Korea.
“While it is still early days, there is a risk that any outbreak could depress consumer sentiment and spending, including tourism, as well as travel and transport-related business,” National Australia Bank Ltd strategist Rodrigo Catril said.
“In addition to the sad and devastating human cost, [SARS] also had an economic impact, with epicenters such as Hong Kong enduring a short-lived recession,” Catril said. “This time the epicenter is in China, so the economic growth impact could be more severe.”
Most markets across Asia were in positive territory yesterday as traders kept tabs on developments linked to the virus.
“The main focus for investors still appears to be on the underlying economic data,” CMC Markets UK chief market analyst Michael Hewson said.
Tokyo ended up 0.7 percent, while Hong Kong added 1.2 percent following a 2.8 percent plunge the previous day.
Sydney rose 0.9 percent, Wellington added 0.7 percent and Singapore put on 0.2 percent.
Seoul climbed more than 1 percent after data showed that South Korea’s economic growth rallied at the end of last year, indicating a bright outlook for this year.
There were small losses in Manila and Mumbai.
“I would expect a lot of people — candidly, like we are — that are looking for opportunities to buy rather than sell” stocks, Villere & Co’s portfolio manager Lamar Villere told Bloomberg TV.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
TRANSFORMATION: Taiwan is now home to the largest Google hardware research and development center outside of the US, thanks to the nation’s economic policies President Tsai Ing-wen (蔡英文) yesterday attended an event marking the opening of Google’s second hardware research and development (R&D) office in Taiwan, which was held at New Taipei City’s Banciao District (板橋). This signals Taiwan’s transformation into the world’s largest Google hardware research and development center outside of the US, validating the nation’s economic policy in the past eight years, she said. The “five plus two” innovative industries policy, “six core strategic industries” initiative and infrastructure projects have grown the national industry and established resilient supply chains that withstood the COVID-19 pandemic, Tsai said. Taiwan has improved investment conditions of the domestic economy
Sales in the retail, and food and beverage sectors last month continued to rise, increasing 0.7 percent and 13.6 percent respectively from a year earlier, setting record highs for the month of March, the Ministry of Economic Affairs said yesterday. Sales in the wholesale sector also grew last month by 4.6 annually, mainly due to the business opportunities for emerging applications related to artificial intelligence (AI) and high-performance computing technologies, the ministry said in a report. The ministry forecast that retail, and food and beverage sales this month would retain their growth momentum as the former would benefit from Tomb Sweeping Day