Stocks have recovered after a drop due to coronavirus concerns.
Asian markets took a fall early in the week amid fears over a virus that broke out in China. Wednesday saw Asian stocks recover as the Chinese response to the virus fostered confidence and tempered fears of a new global pandemic.
Shares in Asian stocks rose throughout Wednesday, with the exception of Shanghai, where worries over a hit to domestic demand and tourism have kept investors worried. The fears over the new virus discovered in the city of Wuhan come as China prepares for the Lunar New Year. The Lunar New Year typically sees millions of Chinese traveling for festivities and to visit family. The original fears over the virus have pulled Asian stocks down from recent peaks that were reached as the trade truce brought optimism to the Asian markets.
The Shanghai Composite index recovered from its recent 1.4% drop and is trading 0.01% higher. Safe haven assets like the Japanese Yen, gold, and bonds were up amid the scare, but have returned Tuesday’s gains. The MSCI index, which covers Asia-Pacific stocks outside of Japan, rose 0.71% on Wednesday, taking it halfway to recovery from Tuesday’s losses. Japan’s Nikkei, Hong Kong’s Hang Seng, and South Korea’s Kospi indexes were all up more than 0.5% on Wednesday.
The virus in China has been dubbed 2019-nCoV, also known as coronavirus. Scientists have yet to determine how dangerous it might become, but it has been discovered to be a cousin of the SARS and MERS viruses. The virus broke out in Wuhan, China, but spread to 13 Chinese provinces. Cases of the virus have been reported in the US, Taiwan, Japan, South Korea, and Thailand.