Closed Coronavirus: US stocks notch biggest drop since October – as it happened

China Outbreak

Growing concerns over the coronavirus that has swept across China have hit global markets, sending stocks lower and havens rallying. Follow the FT’s live coverage.

Coronavirus fears spread

Welcome to the FT’s rolling coverage of the deadly coronavirus outbreak in China.

The disease has now killed at least 81 people in China and infected more than 2,500, leading authorities to extend the lunar new year holiday in some cities and impose an unprecedented lockdown on a population of about 40m around Wuhan in Hubei province.

The effects are beginning to ripple around the world, with global stocks falling sharply as concerns grow over the economic impact of the outbreak.

We will have reports and analysis throughout the day from the FT’s teams in China and around the world.

European stocks on track for worst day in more than three months

A rolling stock market sell-off has gathered pace throughout the day, while investors have also moved into haven assets.

European stocks are on track for their worst day since early October, with major names in the travel, luxury and mining sectors tumbling. Brent crude is also taking a heavy hit, down more than 3 per cent and below $60 a barrel for the first time this year. Most Asian markets were closed for regional holidays today, but Japan’s Topix fell 1.6 per cent.

Investors have responded by piling into havens, with gold rising 0.8 per cent to $1,578 an ounce. Yields on 10-year US Treasuries, which move inversely to prices, fell 5 basis points to 1.6218 per cent, its lowest level since October. Japan’s yen strengthened past ¥109 to the dollar. China’s offshore renminbi exchange rate weakened 0.8 per cent to Rmb6.9820 a dollar.

Some key points as virus fears weigh on markets and industries

The latest from the Chinese national health commission puts the death toll at 80.

A few key points:

• China’s leaders are bracing themselves for a blow to first-quarter growth as the virus fears weigh on consumption, travel and manufacturing

• Global stock and oil markets have been hit while haven assets such as gold are up

• As the year of the rat dawns, the virus outbreak has led authorities to cancel events for the weeklong lunar new year period that began on Saturday

• Wuhan in Hubei province, where the virus originated, is in lockdown

• Shanghai has ordered companies not to open until February 9 while manufacturing hub of suzhou has postponed the return to work

• Manufacturing hub Suzhou postpones the return to work of millions of migrants for up to a week

How China’s slow response aided the outbreak

City authorities have claimed the air-and-rail travel ban on the city of Wuhan is evidence of decisive action to combat the spread of the disease.

But – as the FT’s Tom Hancock and Wang Xueqiao write – analysts have questioned whether the slow release of information made matters worse.

China only began a determined national drive after President Xi Jinping last Monday urged an all-out effort to curb the spread of the virus, and the Communist party threatened local officials who tried to cover it up.

The government’s dissemination of information on the Wuhan virus is a dramatic improvement on 2003, when authorities covered up the Sars outbreak. But it has remained a slow process, according to analysts.

The city’s bestselling commercial newspaper, the Wuhan Evening News, did not feature the outbreak on its front page for two weeks, between January 6 and January 19.

And Chinese censors also initially instructed media to stick to reprinting official reports on the virus from central government-controlled media, severely restricting independent reporting, according to multiple journalists.

Read the full piece here for more on the Chinese government’s response.

Over 30,000 under observation in China

Naomi Rovnick writes:

According to a statement released this morning by the Chinese National Health Commission, 30,453 people in China are under medical observation for the virus.

30 Chinese municipalities have now reported confirmed cases of Coronavirus to the government.

There are now 5,794 suspected cases of the virus in China

This includes 461 cases that are classed as “severe”.

Big Read on coronavirus: is China moving quickly enough?

Zhang Luhua’s ordeal began when the 57-year-old Wuhan resident had trouble breathing, report Tom Hancock in Wuhan, Christian Shepherd in Beijing and Clive Cookson in London.

A doctor at Hubei Provincial People’s Hospital, one of the best in the city, said she might have a new virus that was starting to cause global alarm, but he could not test her. Four other hospitals then turned her away before a doctor told her she probably had the virus and should go home and “self-quarantine”.

Wuhan, a city of 11m, is at the centre of an outbreak of a previously unknown coronavirus: nCoV, which has demonstrated some similarities with Sars, which killed almost 800 between 2002 and 2004. The global cost of Sars was estimated at $50bn. 

For the authoritarian government of President Xi Jinping, who is under pressure over the protests in Hong Kong and the victory of an opponent in the Taiwanese elections, the outbreak of a new virus is a public test of its ability to manage an international crisis — and one that cannot easily be blamed on malign outside influences. 

The Big Read, published on January 24: The new coronavirus: is China moving quickly enough?.

Travel, luxury and mining shares under pressure

Major stock indexes across Europe have posted severe declines this morning, with London’s FTSE 100 down 2.4 per cent and on course for its worst day since early October.

Household names in the airline, hotels, luxury and mining sectors are under significant pressure, as investor concerns over the economic impact of the virus escalate.

Virus spreads abroad as Australia, South Korea and US report cases

International cases mount as official sources on Monday confirm those affected, writes Naomi Rovnick. Australia reports its fifth case of the virus, which is a 21-year-old woman who arrived in the country on the last flight out of Wuhan to Sydney before China imposed a travel ban.

South Korea confirms four cases, Hong Kong five while the US has reported cases in Washington State, Chicago, southern California and Arizona.

Taiwan, Thailand, Vietnam, Singapore, Malaysia, Nepal and Canada have also announced cases.

In the UK, 52 people have been tested for the flu-like virus but results were negative, the Department of Health and Social Care said on Sunday. The DHSC updates on coronavirus tests at around 2pm London time each day.

UK ‘working on plans’ for British nationals to exit Hubei

FT political correspondent Laura Hughes reports:

The UK foreign office has said it is “working to make an option available” for British nationals to leave China’s crisis-struck Hubei province.

An FCO spokesperson said:

We are working to make an option available for British nationals to leave Hubei Province due to the heavy travel restrictions and increased difficulty of accessing consular or medical assistance.

The safety and security of British nationals is our number one priority. We continue to monitor developments and are in close touch with the Chinese authorities.

If you are a British national in Hubei Province and require assistance please contact our 24/7 number +86 (0) 10 8529 6600 or (+44) (0)207 008 1500.

China’s currency hit by rising angst that virus will slow growth

Hudson Lockett, the FT’s Asia capital markets correspondent, writes:

The offshore exchange rate for China’s renminbi fell almost 1 per cent on Monday with downbeat sentiment in Europe deepening losses incurred during the Asian trading day, as concerns mounted over the economic impact and continued spread of a deadly coronavirus that has forced authorities to lock down multiple Chinese cities.

The 0.9 per cent drop against the dollar to was the largest since December 13, when the currency pulled back from earlier gains made on the promise of a trade war truce with the US.

The offshore exchange rate — which moves unconstricted by the central bank-set trading band that limits moves by its onshore counterpart — is now also trading without immediate reference to the onshore rate.

That is because the larger and more stringently controlled onshore market, where the onshore exchange rate can only move 2 per cent either direction of a daily fix set by the People’s Bank of China, has been off since Friday for the lunar new year holiday. That has left offshore traders without an up-to-date steer from the central bank.

But markets are not completely without signals from Beijing. On Monday China’s banking and insurance regulator pledged support to companies suffering due to the outbreak “through measures such as encouraging appropriate lowering of loan interest rates”.

And if moves by the offshore rate get too big for policymakers to stomach, the PBoC also has tools at its disposal – such as issuance of offshore renminbi-denominated bonds – which can be deployed to mop up offshore liquidity and boost borrowing rates for the currency, making it more costly to bets against.

Investors see volatility ahead

Expectations for volatility in the US equity market have spiked to their highest level since early October, as the CBOE’s volatility index, or Vix, rose 4 points to 18.68.

US shares were set to open sharply lower on Wall Street, with S&P 500 futures indicating a fall of more than 1.5 per cent. A rally in sovereign debt also gathered pace throughout the day’s trading as investors moved into the relative safety of government bonds.

JPMorgan downplays virus impact on global markets’

Outbreaks like the SARS-like pathogen that sickened more than 2,000 people in China are “alarming” but their effect on global markets tends to be “fleeting”, JPMorgan has told its clients.

The New York-based bank said on Friday that “although these recurring outbreaks are alarming, there appears to be no ominous message about public health issues as black swans for markets”.

“Such episodes flare every few years but are fleeting,” JPMorgan strategists said, noting, “mortality from epidemics has been declining for two decades.”

“The more epidemics prove containable, the less each subsequent one should move markets,” JPMorgan said, framing the outbreak as a regional not a global shock.

The bank added:

The outbreak of the coronavirus could drive large swings in the mainland China/emerging markets Asia growth profile in the first half [of this year] but a much smaller impact on full-year growth, if the Sars episode is any guide.

Wuhan mayor concedes virus information was not disclosed in ‘timely manner’

Naomi Rovnick writes:

Coverage of the coronavirus was slow to start in the Chinese state media, but it has moved to the top of the political agenda today.

Premier Li Keqiang earlier visited Wuhan to monitor how the virus was being controlled and express the government’s support for victims and those on the front line of fighting it.

In a rare instance of self-criticism by a top official, the mayor of Wuhan, Zhou Xianwang, admitted in an interview with state broadcaster CCTV that, at the early stages of the outbreak, information about coronavirus was not disclosed in a “timely manner.”

Mr Zhou’s concession came after he revealed in a press conference on Sunday evening that 5m people had left Wuhan, either because of the epidemic or the lunar new year holiday.

The English language version of the Global Times, a state-run publication known for expressing hardline views from within the Communist party, took a critical approach to Mr Zhou’s revelation, writing in an editorial:

The news came as quite a shock.

Where have these 5 million people gone? How many of them are carriers of the new coronavirus? How many people will be infected because of them? These questions are disturbing.

Mapping the spread of coronavirus

The FT’s visual data team has been crunching the latest figures and has produced the below map, tracking the spread of the SARS-like virus.

Emoticon Opec weighs deeper production cuts as virus hits prices

David Sheppard, the FT’s Energy Editor, writes:

Opec and its allies have held preliminary discussions about making deeper cuts to oil production if the fallout from the coronavirus crisis keeps weighing on crude prices, with Brent falling to a three-month low below $60 a barrel on Monday.

The cartel, which has been cutting output with allies like Russia since 2016, is due to meet in early March in Vienna, and are examining options to stem the renewed price rout, which has seen Brent slide almost 17 per cent since hitting a high near $70 a barrel in early January.

“They are prepared to do anything if there is a need,” one senior Opec source told reporters on Monday. “They are watching the market closely.”

Analysts compare Sars v coronavirus impact on hotel industry

InterContinental Hotel Group showed a drop of 26 per cent in revenue growth in the quarter that Sars hit, returning to positive growth in the first quarter of the following year, as analysts look back to the virus that was identified in 2003, writes Alice Hancock in London.

Viruses and major terrorism incidents have not appeared to have a longer lasting effect on travel, says Julian Easthope, an analyst at Royal Bank of Canada.

Whether it is terrorist incidents or pandemics – the impact is typically short term, potentially quite severe initially but usually with a quick recovery. In most cases, the incidents are location based with some collateral damage to nearby countries.

Based on the last three flu pandemics – Sars, swine flu and Mers, the outbreak peaks in a few months with recovery seen in a year.

But, as authorities restrict travel, the full impact on the industry is not yet known.

The UK Foreign Office has advised any British nationals planning trips to Hubei province and says it is working on finding options to allow any of those in the province to leave.

China’s Ministry of Transport has said that air and rail passenger numbers were 41 per cent lower compared with last year on the first day of the Chinese lunar new year.

Shares in major hotel groups have fallen about 2-3 per cent in Monday trading. In Europe, IHG has suffered the worst as shares fell nearly 6 per cent in midday trading in London.

Why luxury stocks are suffering

Any hit to the Chinese consumer means bad news for European luxury goods makers.

Shares in some of the world’s major luxury brands have taken a pounding since the coronavirus outbreak rose to international attention earlier this month.

London-listed Burberry has lost more than 13 per cent of its stock market value since January 17. Hermes, which is listed in Paris and one of Europe’s biggest decliners today, has lost 7 per cent in that time.

Like many of their European peers, both Burberry and Hermes generate significant sales in Asia:

Germany, Netherlands consider evacuating citizens from Wuhan

The German government is weighing whether to evacuate its citizens from Wuhan, the epicentre of the coronavirus outbreak, writes Guy Chazan, the FT’s Berlin bureau chief.

“We are considering a possible evacuation of all Germans who want to leave,” Heiko Maas, the German foreign minister, said on Monday.

A team of German consular officials is expected in Wuhan on Monday afternoon.

Mr Maas said the crisis staff in the foreign ministry was discussing necessary measures.

Travelers should think about postponing or cancelling all non-urgent trips to China.

He said the embassy was in contact with all German nationals in Wuhan.

The Netherlands meanwhile is assessing ways to evacuate 20 of its citizens from Wuhan, reports ANP, the largest Dutch news agency. The Dutch foreign ministry did not immediately comment or confirm the details.

Coronavirus fears rattle markets

Escalating concerns over the spread of the deadly coronavirus have sparked a market sell-off, as global stocks tumbled, oil slipped below $60 a barrel and investors moved into haven assets.

Here are the key moves at the European lunchtime:

• Major bourses across Europe posted broad declines, and the composite Stoxx Europe 600 was on course for its worst day since early October as it fell 1.9 per cent.

• Shares in the travel, luxury goods and mining sectors tumbled. Air France-KLM was recently the biggest faller in Europe, down 6.2 per cent.

• US markets were set to open lower, with futures tied to the S&P 500 recovering slightly within the last hour to point to losses of 1.4 per cent at the open on Wall Street.

• Oil prices fell as much as 3 per cent before recovering slightly. Brent was down 2.6 per cent a few moments ago, and trading below $60 for the first time this year.

• Investors piled into havens, with gold rising 0.8 per cent to $1,580 an ounce. Yields on 10-year US Treasuries, which move in the opposite direction to prices, fell 6 basis points to its lowest level since October.

Travel curbs could strain trade relations

Economics correspondent Delphine Strauss writes:

China’s travel curbs could add to the strains on trade relations between Beijing and Washington, an economic consultancy notes, because any lasting fall in tourism would make it harder to meet its pledge to buy an extra $200bn of goods and services from the US.

Freya Beamish, chief Asia economist at Pantheon Macroeconomics, said Japan and Thailand – two of the main international destinations for Chinese tourists – were among the economies that would suffer most if the suspension on sales of tours stayed in place.

Other economists say that Hong Kong, Vietnam, Singapore and the Philippines – where tourism accounts for a higher share of GDP and is more reliant on Chinese visitors – could feel the impact.

Ms Beamish added that the ban could also damage China’s chances of meeting its commitments on services purchases under the Phase One trade deal with the US. Spending on tourism in 2018 could have accounted for anywhere between 5 to 17 per cent of the 2020 target for increased sales over the 2017 baseline, she noted.

Chad Bown, a senior fellow at the Peterson Institute for International Economics, wrote earlier this month that many experts already believed Chinese purchases were “bound to fall short”, adding: “That matters, because with unrealistic export targets, the deal may be doomed from the start”.

Dispatch from Wuhan

Tom Hancock reports from the epicentre of the coronavirus outbreak:

Numbers visiting hospitals with symptoms of fever appeared to have declined in the past few days. More than two dozen patients waited at a fever clinic (pictured below) at one Wuhan hospital, but staff said patients could see a doctor within an hour of arrival, down from several hours a few days ago.

Streets were mostly empty but taxis and some cars with government permission drove on roads. Delivery services continued to operate. “We are getting the most orders for supermarket goods such as vegetables, masks and disinfectant,” said Yu Wenqiang, a driver for delivery service

Supermarkets remained open and were mostly well stocked. Some Wuhan residents said they were struggling to find supplies of safety masks. “I’ve been to six stores already today and couldn’t find any masks,” said a 30-year-old man surnamed Song.

For more photos and dispatches, see Tom’s Twitter account.

Latest on global coronavirus cases

Details of confirmed new cases:

• The Canadian province of Ontario has announced a second case: the wife of the man who was the country’s first confirmed case. “Given the fact that she has been in self-isolation, the risk to Ontarians remains low,” said chief medical officer Dr. David Williams.

Cambodia has confirmed its first case, becoming the latest south-east Asian country to be hit by the disease, the FT’s south east Asia correspondent John Reed reports. Mam Bunheng, the country’s health minister, told journalists in a press conference on Monday evening that the patient was a Chinese citizen staying in the coastal province of Sihanoukville.

• China is the main source of foreign visitors to Cambodia, and Sihanoukville is the country’s biggest centre of casinos catering to Chinese gamblers. Elsewhere in the region, Thailand and Vietnam are among the countries that have reported cases of coronavirus.

Hong Kong has confirmed two more cases, bringing its total to eight, according to AP.

• The latest number of cases in China, according to state media, is 2,835 with 81 deaths, Naomi Rovnick reports.

Banks take measures to protect staff against potential infection

FT European banking correspondent Stephen Morris writes:

International banks and wealth managers, which have been expanding aggressively into China in recent years, have been ringfencing potentially exposed staff and banning those who have recently travelled to the mainland from entering major regional offices.

Credit Suisse has sent its staff in Hong Kong a memo instructing them to work from home and not come into its headquarters in the International Commerce Center tower if they have visited the mainland in the last 14 days.

Affected employees will be required to remain at home for at least a fortnight and get a doctor’s certificate before they return if they have fever or flu-like symptoms. The bank is also offering temperature checks in its main office, which remains open.

“Business travel should be limited to essential travel only,” the memo said, which was confirmed by a spokesman. “We encourage you to conduct meetings via conference call and video conferencing.”

Credit Suisse also cautioned employees should “keep in mind that information circulating on social media may not always be accurate” and to follow the “mainstream media” for developments.

Fellow Swiss bank UBS has also told its 2,500 in Hong Kong workforce to stay at home if they have travelled to China recently. The lender – which also has 1,200 employees on the mainland in Beijing, Shanghai and Guangzhou – has set up an “internal pandemic website”, but all its offices remain open, according to a spokesman.

Staff are banned from travelling to China unless it is deemed “critical” and this would require approval from senior members of UBS’s Asia-Pacific executive committee as well as its business continuity planning team, he said.

HSBC said it is “monitoring the situation” and “following guidance of public authorities”. While it has instituted “more restrictive travel policies”, travel to the mainland from Hong Kong is not banned.

Staff have been told not to come into the office until February 3, the date when the Chinese lunar new year has been extended to by the government.

Landlocked Mongolia shuts down border with China, reports say

Mongolia has closed its vast border with China, the Associated Press reported, after Malaysia and Hong Kong said earlier on Monday that they would temporarily ban visits from Wuhan, the province at the epicentre of the coronavirus outbreak.

Political relations between the two neighbours are often strained, as they have been since at least the 13th century when Kublai Khan swept into China and founded the yuan dynasty, writes Naomi Rovnick in London.

But business links are strong, thanks to landlocked Mongolia’s abundance of natural resources and China’s hunger for commodities.

About 79 per cent of Mongolia’s imports and exports are traded directly with China, according to UK government data.

Emoticon Wall Street tumbles at the open

The global stock market sell-off has spread to Wall Street, where the S&P 500 and Dow both opened 1.8 per cent lower. The tech-weighted Nasdaq fell 2.4 per cent.

The falls mirror the moves in Europe today – the Stoxx 600 index has deepened its losses throughout the trading session and was down 2.3 per cent a few moments ago. That leaves the index which tracks the biggest 600 companies in the region on course for its biggest one-day loss since early October.

Previous outbreaks rebounded after initial market hit, JPMorgan says

Many investors are casting their eyes back to previous outbreaks in search of patterns and trends that might inform their investment decisions, even as many questions remain about the coronavirus outbreak, reports Anna Gross in London.

“It’s important that we don’t panic but really look to history as a guide,” said Kristina Hooper, chief global markets strategist at Invesco. “At the moment, so little is known that it’s difficult to even pull in experts.”

JP Morgan has assessed the market impacts of previous outbreaks, such as Sars in 2003, swine flu in 2009, Ebola in 2013 and Zika virus in 2015.

The Sars outbreak sparked an 8.6 per cent drop in the MSCI China index between March and April 2003. The index rebounded 31 per cent over the following three months. Similarly, swine flu triggered a 4 per cent decline in the MSCI Mexico, rebounding 25.7 per cent over the three-month period that ensued.

Sars is widely considered to be the most comparable historic viral outbreak. Hong Kong equities shed almost a fifth of their market capitalisation over the course of a few months during the epidemic and Chinese markets were down 15 per cent, according to analysis by JPMorgan. However the analysts note that, as uncertainty eased in late April, MSCI China and Hong Kong reversed all of their losses and went on to make significant gains.

In a sense, the more equities fell initially, the more they subsequently rebounded. These episodes did not lead to a prolonged period of selling, and were a buying opportunity within weeks.

Luxury, hotels, restaurants, leisure and airlines were the sectors that were hit the most, outperforming the market when it rebounded.

“Investors with a short-time horizon should expect that if they don’t move to safe haven asset classes they will be negatively impacted,” said Ms Hooper.

Some of the major losers in the US

US airlines are some of the biggest fallers on Wall Street, while casino operators with heavy exposure to the Chinese gambling hub of Macau are also suffering in this morning’s broad stock market sell-off.

Here is a snapshot of around 10 minutes after the opening bell in New York:

El-Erian: Longer-term uncertainties continue to mount

Mohamed El-Erian, chief economic adviser to Allianz, believes markets are responding “in a textbook fashion” to the virus fears as the sectors most directly exposed to China sink. 

The former chief executive of bond giant Pimco said on Twitter that the next stage “will be more interesting, especially given the underlying Corona virus uncertainties.”

Specifically, the risk to fundamentals associated with the potential stagflationary shock will compete with market conditioning trusting the willingness/ability of central banks to counter with liquidity. But have no doubt, the longer-term uncertainties continue to mount.

Trump says US-China in close contact over coronavirus

Donald Trump has said the US is in “close communication” with China over the Coronavirus outbreak and has offered Beijing help.

Five cases of the coronavirus have been confirmed in the US, while at least 81 people have died and 2,844 are infected in China, according to state media reports.

Nissan, PSA and Renault seek to pull staff from China’s virus-hit areas

International carmakers, including Nissan and France’s PSA and Renault, plan to begin pulling foreign staff from plants in the parts of China that have been hit by the coronavirus, reports Peter Campbell.

Nissan is preparing to send home its Japanese staff in Wuhan, the epicentre of the outbreak, on a government-chartered flight, a spokesperson said.

The Japanese carmaker’s Chinese partner Dongfeng is building a plant that will be used by the companies’ joint venture DFL to build vehicles.

French carmaker PSA is also attempting to evacuate non-Chinese nationals from its three production sites in the region, the company said on Monday.

It intends to remove some 38 people, including expatriates and their families, to France to be put in quarantine, a spokesman said.

Renault, working with French authorities, is offering expatriates from its Wuhan plant the option to leave the country temporarily, a spokesman said.

General Motors, which owns a site with SAIC that employs 6,000 workers, said it is “continuing to monitor the situation very closely”.

A spokesman added: “We are advising our team members to follow official guidance on steps to prevent exposure to and transmission of the virus, and we are relieved that at last report none of our employees has contracted the virus.”

Honda and Geely also have facilities in the area, which is a large car producing region of China.

All of the car plants have been closed for the lunar new year period, though it is not yet clear whether they will open as planned at the start of February.

Wuhan mayor: Beijing partially responsible for lack of ‘timely disclosure’

Sun Yu, China Economics Reporter

Zhou Xianwang, Wuhan’s mayor, said he would resign if the decision to lock down the city made people angry about the authority. “We are willing to do (anything) to control the disease,” he said in a televised interview with CCTV, China’s state broadcaster on Monday.

Mr Zhou acknowledged the government’s failure to handle the crisis. “We need to improve the ability to address public health events … and manage emergencies,” he said.

The mayor also admitted local authority had downplayed the spread of the disease by “not making a timely disclosure”. But he said Beijing was partially responsible as well.

“Please understand why we did not make a timely disclosure of the virus. This is an infectious disease and must be disclosed according to law. Local governments can not disclose the disease until it gets authorisation to do so … We found it much easier to perform our duty after the State Council decided on Jan 20 to make local governments responsible for (containing the disease).”

As of 10 pm, China reported 2,844 confirmed cases, including five in Taiwan, and 5,794 suspected ones. The death toll stood at 81.

Investors reach for safety

As stock markets tumble around the world, investors have piled into haven assets.

The yield on the benchmark US 10-year Treasury note fell seven basis points to below 1.61 per cent as investors moved into the relative safety of government debt. Gold rose 0.7 per cent to $1,581 per troy ounce.

No confirmed cases of coronavirus in the UK

Naomi Rovnick writes:

The UK remains one of the major destinations for Chinese tourism and investment that has not yet recorded any cases of coronavirus.

The Department of Health and Social care said on Monday afternoon that 73 patients had now been tested for the virus, all with negative results.

The UK has sent public health experts into airports to support travellers from China who feel unwell. The travellers are also being given information at airports to help them identify symptoms of the virus and seek medical care.

Clinicians are testing patients for coronavirus, according to Public Health England (PHE), by taking samples from their noses and throats. The samples are then sent to PHE’s laboratory in Colindale, north London, where virologists previously assessed potential cases of the Middle East respiratory syndrome (Mers) and Ebola.

Cruise companies dock boats to combat virus spread

Alice Hancock, Leisure Industries Reporter

Cruise companies are cancelling sailings for fear of spreading the virus further. Royal Caribbean’s Spectrum of the Seas was due to set sail from Shanghai on Monday, but the company said it had suspended the journey and was offering refunds to customers.

MSC Cruises, whose ship Splendida is currently in Shanghai, has also cancelled that itinerary.

Costa Cruises, which has the biggest presence in China of all the major cruise companies, said it was giving all passengers a pre-boarding health questionnaire and screening guests and crew. “Anyone who has an illness of international public health concern will not be permitted to sail,” it said.

China is a growth market for the industry and accounts for almost 8% of that market’s annual capacity, according to the Cruise Industry News annual report.

Sri Lanka confirms first case of coronavirus

Amy Kazmin, South Asia bureau chief

Sri Lanka’s health ministry has confirmed the island’s first case of novel coronavirus, with local media reporting that a 43-year-old Chinese woman currently in hospital had tested positive for the virus.

In a Facebook announcement, the government health promotion bureau urged the public not to panic, saying authorities were taking necessary measures to prevent the virus’ spread.

Shanghai exchange extends holiday

Naomi Rovnick writes:

The Shanghai Stock Exchange, mainland China’s main securities market, said it would remain closed until February 3. The original plan had been to shut down until January 31 for the lunar new year holiday, but China’s state council has now decided to prolong the break from trading, the SSE said in a statement on its website.

Hong Kong’s stock market, which is the main entry point into China for international investors, is expected to reopen this Wednesday after closing for the long new year holiday.

Because trading in Shanghai-listed shares remains restricted for global fund managers, Hong Kong stocks are most likely to bear the brunt of international nervousness about the effects of coronavirus on China’s economy.

Global equities are down sharply today. Wall Street’s S&P 500 and Europe’s Stoxx 600 have dropped 1.6 per cent and 2.3 per cent, respectively.

Analysts encouraged by China’s response

China’s economy is likely to take a hit from the coronavirus, but the disproportionate impact on specific sectors such as tourism and retail will likely be short-lived, according to Shore Capital.

The broker’s healthcare research team said they are encouraged by China’s response to the outbreak, and “believe the global healthcare system is better placed to deal with the Wuhan outbreak than it was with SARS given the knowledge that has been gained”.

They also highlighted some specific sectors which could receive a boost, including Chinese antibiotic manufacturers and fast moving consumer goods companies, which could benefit from an increased demand from products such as hand gels.

China’s auto industry faces up to further disruption

The FT’s motor industry correspondent Peter Campbell reports:

Car plants across parts of China may be unable to open after the lunar new year holiday because they rely on parts coming from the region most affected by the coronavirus outbreak, according to several industry figures.

While the country’s auto facilities are closed over the holiday, they had expected to re-open in the first week of February.

However many are reliant on parts coming from deep inside Hubei province, which has been the epicentre of the outbreak.

Nissan, PSA, Renault, Honda and Geely all have plants operating or under construction in Wuhan itself. But the city is also home to a large range of auto parts suppliers, which serve a wider network of assembly plants.

Carmakers hold very little stock at their assembly operations, instead relying on just-in-time supply chains that see parts delivered to the assembly plant hours or even minutes before required in the factory.

The chief executive of one international carmaker in the region told the FT that securing parts supply would be critical to its plants – which are unaffected by the outbreak itself – re-opening after the holidays.

Robin Zhu, a Hong Kong-based auto analyst at Bernstein warned of “supply disruption as factory workers return later from the holidays”.

Michael Dunne, a former GM executive who runs the China-focussed ZoZo Go auto consultancy, said that Nissan, PSA and Honda will be the most affected.

He added that parts deliveries would be unlikely to stretch across China, as most suppliers set up operations in different parts of the country to serve local plants.

India prepares for possible evacuation of citizens from Wuhan

Amy Kazmin, South Asia bureau chief

The Indian government says it is taking steps to “prepare for possible evacuation” of its’ citizens from Wuhan. Indian authorities estimate around 200 Indians, including many medical students and professionals working in companies there, are presently trapped in the city.

In its Monday night statement — issued after a high level meeting to assess preparedness to cope with the virus, New Delhi said it “will make a request to the Chinese authorities” regarding possible evacuation.

Earlier in the day, the government had told its citizens stuck in Wuhan to inform the Indian embassy in China if they are facing shortages of food, water or essential supplies so they could ask Chinese authorities to assist.

The Indian embassy in Beijing has set up special hotlines to support its citizens now trapped in the quarantine zone.

It has also asked its citizens who are not in possession of their own passports to provide the embassy with their passport details.

India says it has screened nearly 30,000 passengers arriving on flights from China for symptoms of the virus, and that none of the 12 samples samples taken from patients under observation have tested positive for the virus so far.

Wall St extends slide as coronavirus fears rise

US stocks extended their decline on Monday amid fears of the economic impact from the spread of the coronavirus.

Here’s a look at markets in late morning trade:

1. The S&P 500 was down 1.6%, on track for its worst day since October 2.

2. The Nasdaq Composite had shed 2%, eyeing its biggest one-day drop since August.

3. US Treasuries rallied as investors sought the safety of government bonds, with the yield on the US 10-year down 6.8 basis points to 1.6115%. Yields move inversely to prices.

4. The Vix, or Wall Street’s fear gauge, climbed 3.4 points to 17.98 — its highest intraday level since October.

5. Gold prices climbed 0.7% to $1,582.93 a troy ounce.

Emoticon European stocks close more than 2 per cent lower

European stock markets suffered their worst session since October 2, as the composite Stoxx 600 index closed 2.3 per cent lower. Germany’s Dax and France’s Cac 40 each fell 2.7 per cent, while London’s FTSE 100 ended 2.4 per cent lower.

The declines were broad based, with all of the Stoxx sectors closing in the red. Europe’s largest 600 companies source 5.4 per cent of their revenues from mainland China, according to Factset data.

Disney slides 3% as JPM analyst warns of earnings pressure from virus

Disney shares fell 3% on Monday after JPMorgan warned of pressure on earnings from the closure of parks in Shanghai.

The company announced a temporary closure of Shanghai Disneyland on Friday due to the outbreak of the coronavirus. Wuhan is about four to six hours from Shanghai Disney by train.

Alexia Quadrani, analyst at JPMorgan said:

We note the closure comes at a lucrative and peak travel time to celebrate Lunar New Year on 1/25, and the Holiday season extends into February. We also see a potential impact to Disney’s Studio business as theaters across most of the country have been closed, which if still in effect, would impact the anticipated release of Mulan in March.

She added:

While there is little question these events will lead to some downward pressure on earnings, the magnitude of the revision is not likely to be sizable relative to the overall company’s earnings.

On Sunday, Hong Kong Disneyland also announced a temporary closure as a “precautionary measure”.

US may expand travel and screening recommendations

Hannah Kuchler writes:

The US government is considering expanding its travel and screening recommendations to try to slow the spread of the coronavirus within the next 24 hours, according to the Centers for Disease Control and Prevention.

Nancy Messonnier, director of the CDC’s National Center for Immunization and Respiratory Diseases, said the outbreak is “unfolding rapidly”, so the US is considering broadening screening at the border and changing its recommendations on where Americans should travel.

“We are imminently thinking about this decision. As you all know, there is lots of new information coming out of China in terms of what’s going on outside Wuhan. We are trying to take that all into account as quickly as we can,” she said on a conference call with reporters.

The US has screened 2,400 people coming from Hubei province, where Wuhan is located, and is continuing to track passengers in transit who took indirect routes from the province, now that there are no longer direct flights.

The CDC is tracking 110 people who they suspect could have been exposed to the disease across 26 states but so far there are only five confirmed cases of the coronavirus in the US. The public health department is working to distribute a new diagnostic test to healthcare providers, which will take a week or two.

UK foreign office advancing measures to bring back UK nationals from Hubei province

Sarah Neville, Global pharmaceuticals editor

The UK Foreign Office is “rapidly advancing measures to bring UK nationals back from Hubei Province”. Officials suggested no more than 200 people were likely to return, and that they would be asked to remain isolated for 14 days after they landed back in the UK so authorities could be confident they had not contracted the virus.

Matt Hanock, health secretary, said: “I have asked my officials to ensure there are appropriate measures in place upon arrival to look after them and protect the public.”

The UK government also announced strengthened restrictions for people who have recently flown into the UK from Wuhan, amid some concerns that even people who do not show symptoms of the illness could potentially be infectious to others.

Mr Hancock emphasised that current evidence was that most cases appeared to be mild. However he told MPs he had asked Public Health England, the relevant authority, “to take a belt and braces approach, including tracing people who have been to Wuhan in the past 14 days”.

From today anyone in the UK who had returned from Wuhan in the last two weeks was being asked to “self-isolate”, staying indoors and avoiding contact with other people. They should call their family doctor, or the NHS’s telephone advice line, 111, if they developed respiratory symptoms within two weeks of travel.

Mr Hancock said having eliminated those who were known now to have left the country, “there are 1,460 people we are seeking to locate”.

An update on confirmed cases of coronavirus

Canadian officials have confirmed two cases of the virus there, raising the global tally to 2,908.

Here’s a map showing the spread of coronavirus:

US stocks notch biggest drop since October

Wall Street’s main equities gauges fell the most in almost six months after concerns the fast-spreading coronavirus could weigh on global growth rattled markets.

The S&P 500 and Dow Jones Industrial Average both fell by 1.6 per cent for their largest one-day drops since October 2. Energy, down 2.8 per cent, and technology, down 2.3 per cent, were the S&P 500′s worst performing sectors owing to their sensitivity to global economic growth.

The Nasdaq Composite, filled with growth-sensitive tech companies, fell 1.9 per cent for its largest decline since August 23.

Brent crude, the international oil benchmark, was down 3.1 per cent at $58.88 a barrel in afternoon trade in New York.

Investors sought safety in gold, which was 0.7 per cent higher to $1,582.65 an ounce, and government bonds.

The yield on the benchmark 10-year Treasury was down 7.9 basis points at 1.6012 per cent, while that on the two-year dropped 4.5bp to 1.4408 per cent.

Volatility in the US stock market, as tracked by the Vix, jumped to its highest level since early October.