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Asian stocks snap 4 months of gains in January on coronavirus worries

Published 03/02/2020, 07:52 pm
Updated 03/02/2020, 07:57 pm
© Reuters.  Asian stocks snap 4 months of gains in January on coronavirus worries
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Feb 3 (Reuters) - Asian stocks sank in January, ending a four-month-long rally, as a coronavirus outbreak in China sapped investors' risk appetite and raised concerns about economic impact from the epidemic.

The MSCI's broadest index of Asia-Pacific shares .MIAP00000PUS shed 2.86% in January, compared with a decline of about 1.17% in the MSCI's global share index. .MIWD00000PUS .

The coronavirus that originated in the central Chinese city of Wuhan last month has killed more than 350 people, disrupted supply chains and curbed travel, which economists say will weigh on economic growth in China and its trading partners. revised its full-year forecast for China's GDP growth to 5.5% in 2020 from 5.8% at the end of last month. JPMorgan (NYSE:JPM), meanwhile, trimmed its forecast for global growth in the current quarter by 0.3 percentage point.

Philippines .PSI and Hong Kong .HSI shares lead declines in regional equities last month. The two markets fell about 7.9% and 6.7%, respectively, in January.

China shares .SSEC , however, fell just 2.4% as financial markets in the country began an extended Lunar New Year holiday on Jan. 24. The Shanghai Composite index plummeted as much as 8.73% when the market reopened on Monday.

Appetite for Asian shares remains weak against the backdrop of the coronavirus outbreak in China, some analysts said.

"Sentiments remain very fragile as markets dynamically try to get a sense of when containment will catch up with contagion." Vishnu Varathan, a senior economist at Mizuho Bank, said in a note to clients.

"Until then, backstops and stabilization may be more a punctuation in the 'risk off' environment rather than a turnaround in sentiment."

https://tmsnrt.rs/2GQfVwC Asia Pacific equities' performance in 2020

https://tmsnrt.rs/2vFDwhe

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