Asian Shares Mostly Lower On Virus Worries

Asian stocks ended mostly lower on Monday as a spike in coronavirus cases in the United States and Europe fueled worries about a deep global recession.

More countries and regions are resorting to shutdowns and border closures to prevent the spread of COVID-19, raising concerns about the likely economic impact of the pandemic.

China’s Shanghai Composite Index plunged 85.45 points, or 3.1 percent, to 2,660.17 despite the health commission of Hubei province, of which Wuhan is the capital, reporting no new infections for a fifth day in a row. Hong Kong’s Hang Seng Index plummeted 1,108.94 points, or 4.9 percent, to 21,696.13.

Meanwhile, Japanese shares rebounded after Prime Minister Shinzo Abe hinted that the Tokyo Olympics could be postponed but ruled out the possibility of canceling the global sporting event.

Growing hopes for the Bank of Japan’s stepped-up purchases of exchange-traded funds also offered some support.

The Nikkei 225 Index jumped 334.95 points, or 2 percent, to 16,887.78, bouncing off a 3-1/2-year low touched last week. The broader Topix closed 0.7 percent higher at 1,292.01.

Ad firm Dentsu Group soared 8.6 percent after the International Olympic Committee’s executive board said it is considering postponing but not canceling this summer’s Olympic Games. Dentsu is the main marketing agency for the event.

Market heavyweight SoftBank Group jumped 18.6 percent to hit its daily limit after the tech conglomerate said it would sell up to 4.5 trillion yen ($41 billion) in assets to fund a share buyback of up to 2 trillion yen and reduce debt.

Australian markets extended their rout as businesses across the country prepared to shut or scale down their operations to contain the spread of the coronavirus.

The benchmark S&P/ASX 200 Index nosedived 270.60 points, or 5.6 percent, to 4,546, the lowest level since December 7, 2012. The broader All Ordinaries Index dropped 290.20 points, or 6 percent, to 4,564.10.

The big four banks fell 9-12 percent, while investment bank Macquarie Group plunged 15.3 percent. In the energy sector, Origin Energy, Woodside Petroleum, Santos and Beach Energy lost 4-12 percent, while Oil Search plummeted 19.7 percent.

Retailer JB Hi-Fi gave up 10.8 percent after withdrawing its guidance. Mining heavyweight Rio Tinto declined 4 percent, while BHP finished marginally higher. Healthcare giant CSL rallied 4.2 percent after a spate of late buying.

Seoul stocks fell sharply amid growing jitters over the economic fallout from the novel coronavirus. The benchmark Kospi slumped 83.69 points, or 5.3 percent, to close at 1,482.46 after rebounding nearly 8 percent in the previous session.

Trading was briefly halted just six minutes after the opening bell as the market fell by more than five percent due to an extended sell-off by foreign investors.

Health authorities detected 64 new coronavirus cases on Sunday, bringing the total infections to 8,961, but marking the lowest daily increase in almost a month.

Economic worries persisted despite the government last week approving an extra budget worth 11.7 trillion won (US$9.1 billion) and the country’s central bank cutting its policy rate by half a percentage point to a record low of 0.75 percent to fight the viral outbreak.

New Zealand shares fell heavily as Prime Minister Jacinda Ardern raised the nation to COVID-19 alert level three and added that the country will enter alert level four in 48 hours to get on top of the pandemic.

The benchmark NZX-50 Index fell almost 10 percent before ending the session down 697.72 points, or 7.6 percent, at 8,498.70. Casino operator SkyCity Entertainment Group slumped 14.5 percent on news it would shut its casino in Adelaide in line with government orders.

The Reserve Bank of New Zealand today decided to implement a NZ$30 billion asset purchase program as the negative economic implications of the coronavirus outbreak continued to intensify.

Also, the cabinet agreed to remove the cap on the wage subsidy scheme, which will inject a further NZ$4 billion into the economy over the next eleven weeks.

U.S. stocks tumbled on Friday and capped their worst week since the height of the financial crisis as the virus numbers and economic backlash continued to be worrisome.

The Dow Jones Industrial Average plunged 4.6 percent, the tech-heavy Nasdaq Composite shed 3.8 percent and the S&P 500 lost 4.3 percent.

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