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Stock Markets Fall, but Show Signs of Stabilizing Stock Markets Stabilize After an Outbreak-Inspired Slump
(about 5 hours later)
SHANGHAI — Share prices in Asia on Tuesday slid for the second straight day, albeit at a more moderate pace, as investors took their cue from Monday’s sell-offs in Europe and the United States related to the global coronavirus outbreak. SHANGHAI — Global stocks appeared to calm down on Tuesday, a day after fears of the spread of the new coronavirus outside China spooked investors into a worldwide sell-off.
The steepest losses in Asia on Tuesday occurred in Japan, where markets were closed for a holiday on Monday and missed that day’s drop. The Nikkei 225 index was down more than 3 percent by midafternoon. Shares fell in most markets in Asia, led by Japan, which had closed for a holiday on Monday and missed that day’s drop. The Nikkei 225 index tumbled more than 3.3 percent. Most other Asian markets fell at a much slower pace.
Most other Asian markets fell at a much slower pace, and other indicators suggested markets were stabilizing. Futures trading indicated that American and European markets may be little changed or up slightly when they open on Tuesday. Shares in Europe opened mostly higher, suggesting investors’ nerves had steadied, but then slumped into negative territory. Germany’s DAX was 0.4 percent lower, and Britain’s FTSE 100 lost 0.6 percent.
Futures trading indicated that American markets would rise when they opened on Tuesday.
The signs that markets were stabilizing followed a difficult Monday, when investors began to more fully comprehend the extent of the outbreak. On Wall Street, the S&P 500 index fell 3.4 percent on Monday, its worst single-day performance since February 2018. European markets recorded their worst session since 2016.
President Trump, traveling in New Delhi on Tuesday, joked with business leaders that their investments in the United States had made them a lot of money “except for yesterday,” noting the market drop, according to a pool report. Mentioning the coronavirus outbreak, he said, “We think we’re in very good shape in the United States.”
Updated Feb. 10, 2020Updated Feb. 10, 2020
The signs of stabilization followed a difficult Monday, when investors began to more fully comprehend the extent of the outbreak. On Wall Street, the S&P 500 index fell 3.4 percent on Monday, its worst single-day performance since February 2018. European markets recorded their worst session since 2016.
Investors could face more wild rides as the coronavirus outbreak spreads further, crimping consumer demand and snarling the world’s supply chains. UBS said on Tuesday that it was recommending investors switch to emerging market stocks, and warned that holding shares in European companies presented a particular danger.Investors could face more wild rides as the coronavirus outbreak spreads further, crimping consumer demand and snarling the world’s supply chains. UBS said on Tuesday that it was recommending investors switch to emerging market stocks, and warned that holding shares in European companies presented a particular danger.
“The emergence of a large number of new cases in Italy has materially increased the risk of a sharp drop in consumer and business confidence in Europe, and potentially North America too if more cases are confirmed there in the coming days,” Mark Haefele, the chief investment officer at UBS’s global wealth management operations, said in an investment report.“The emergence of a large number of new cases in Italy has materially increased the risk of a sharp drop in consumer and business confidence in Europe, and potentially North America too if more cases are confirmed there in the coming days,” Mark Haefele, the chief investment officer at UBS’s global wealth management operations, said in an investment report.
UBS also said that it was recommending investors buy shares in companies that cater to “stay-at-home” consumers, like electronic commerce and food delivery services.UBS also said that it was recommending investors buy shares in companies that cater to “stay-at-home” consumers, like electronic commerce and food delivery services.
In China, the Shanghai stock market had fallen 1.2 percent by late Tuesday morning, while the market in the city of Shenzhen was down by about half a percent. In China, the Shanghai stock market fell 0.6 percent, while the market in the city of Shenzhen rose by about half a percent.
Both markets had been fairly insulated from the global selling on Monday, a stability that analysts attributed to Beijing policies such as ordering fund managers not to sell more shares than they buy. Beijing has a history of tolerating share price declines more readily if they look like echoes of Wall Street’s activity, and that appeared to be true on Tuesday as well.Both markets had been fairly insulated from the global selling on Monday, a stability that analysts attributed to Beijing policies such as ordering fund managers not to sell more shares than they buy. Beijing has a history of tolerating share price declines more readily if they look like echoes of Wall Street’s activity, and that appeared to be true on Tuesday as well.
The Hong Kong market was little changed, after falling more than the mainland markets on Monday.The Hong Kong market was little changed, after falling more than the mainland markets on Monday.
In South Korea, shaken by the world’s second-largest outbreak of the virus outside China, share prices rebounded on Tuesday morning after enduring one of the sharpest drops of any large market around the world the day before. By midafternoon, they were up 1 percent. In South Korea, shaken by the world’s second-largest outbreak of the virus outside China, share prices rebounded on Tuesday morning after enduring one of the sharpest drops of any large market around the world the day before. They ended up 1.2 percent.
Stock markets in commodity-exporting countries continue to suffer losses as traders worry that demand for their goods may decline if more countries suffer the kind of bruising deceleration in economic activity that China has endured. Australia’s stock market fell 1.6 percent on Tuesday.Stock markets in commodity-exporting countries continue to suffer losses as traders worry that demand for their goods may decline if more countries suffer the kind of bruising deceleration in economic activity that China has endured. Australia’s stock market fell 1.6 percent on Tuesday.