Asian markets build on global rally, virus fears ease

Monitoring Desk

HONG KONG: Asian markets on Wednesday extended this week’s global rally following a fresh record in New York, while safe havens retreated as concerns about the impact of the deadly China virus eased. Despite Beijing announcing that almost 500 people had died from the outbreak and more than 24,000 were infected, analysts said traders were taking heart from the fact that the spread outside China had not spiralled.

Moves by Chinese authorities to support mainland stocks were also providing cheer, with the central bank pumping tens of billions of dollars into financial markets and the government easing restrictions on equities trading.

There had been a worry that the virus could hammer the global and Chinese economies, which had been showing signs of stabilising in recent months following a protracted growth slowdown. World Bank head David Malpass said the group plans to lower its global growth forecast owing to an expected hit to China and the likely impact on global supply chains.

But Lisa Shalett at Morgan Stanley told Bloomberg TV: “These… dislocations tend to be short-lived, and do tend to produce very good entry points and buying opportunities.”

In morning trade, Shanghai rose 1.9%, building on the previous day’s 1.3% advance and digging further into the losses of more almost 8% suffered on Monday. Hong Kong rose 0.9 percent and Tokyo went into the break more than one percent higher.

Sydney gained 0.3 percent, Singapore was up 0.5 percent and Seoul climbed 0.8 percent, with Manila, Taipei, Jakarta and Wellington also well in positive territory.

“The oil market is falling sharply, which is pretty alarming given (producer cartel) OPEC is considering an emergency cut,” Innes said. “But the implied near-term conservative fall in demand from China could create a supply/demand imbalance” of more than a million barrels a day in the first quarter. (AFP/APP)