Stock markets opened lower on Monday, as investor attention returned to the deadly outbreak of coronavirus.
“Coronavirus is the biggest threat flashing on traders’ platform on Monday morning,” said Naeem Aslam, chief market analyst at Avatrade.
The UK’s health secretary declared the epidemic “a serious and imminent threat to public health” on Monday morning, as a fourth case of the virus was confirmed in the UK.
Chinese authorities said the death toll there had risen to 908, surpassing the total deaths from the deadly SARS outbreak in 2003. The number of confirmed cases has now crossed 40,000 in mainland China alone and 60 new cases have been recorded on a quarantined cruise ship in Japan.
The rising death toll comes as China tries to restart its economy after an extended Lunar New Year break. Chinese factories were due to reopen on Monday, although some — including the Foxconn factory where Apple iPhones are made — have remained shut.
“Investors are concerned about the rising death number over in China and workers are not being able to return to work,” Aslam said. “The fear is that by opening factories you increase the risk of contamination.”
Overnight in Asia, the Hong Kong Hang Seng (^HSI) stock index and Japan’s Nikkei (^N225) index both closed down by 0.6%. The Shanghai Composite (000001.SS) rose by 0.5%, as the People’s Bank of China again injected liquidity into the banking system.
“Coronavirus is at the forefront of the risk radar this week, but all the markets really care about is liquidity,” said Neil Wilson, chief markets analyst at Markets.com.
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