HSI Falls Over 4% As Asian Markets Slide Again

Hong Kong stocks tumbled more than 4 percent on Thursday morning, tracking another global rout, as panic-stricken investors bet on the likelihood of a worldwide recession caused by the coronavirus.

The Hang Seng Index tumbled 4.3 percent, or 946 points to 21,344.

On the mainland, the Shanghai Composite Index sank 2.1 percent, to 2,670 while the Shenzhen Composite Index fell 1.5 percent, to 1,563.

Other Asian equities also took a beating while the US dollar surged as a European Central Bank plan to spend more than Us$800 billion to buy bonds failed to instil optimism in traders that the world is heading for a virus-fuelled economic catastrophe.

Asian markets initially climbed on the news but soon went into a tailspin as investors contemplate months of economic hardship with countries around the world in lockdown to prevent the spread of Covid-19, which has now infected more than 200,000 people and killed almost 9,000.

Singapore dived more than 4 percent, Seoul collapsed 8 percent, and Taipei and Mumbai shed more than 6 percent.

Jakarta dropped 5 percent while Tokyo, Sydney, Bangkok and Wellington lost more than 2 percent.

Manila plunged almost 25 percent after reopening following a two-day suspension prompted by the outbreak but it later bounced back to sit 12 percent down.

The sharp losses came in tandem with a rally in the US dollar as investors scrambled for cash to pay debts or just stash away.

The pound is now wallowing around its lowest levels since the mid-1980s, with the British currency dropping below HK$9 and trading at HK$8.93.

The greenback was up more than 6 percent against the Australian dollar and more than 3 percent on the South Korean won.

The New Zealand dollar and Russian ruble lost more than 5 percent.

AxiCorp's Stephen Innes warned of further turmoil despite the historic moves by banks and governments. "Wartime economics is not going to help with everyone in lockdown sitting at home watching Netflix," he said.

Oil markets have been hammered by collapsing demand as the virus prompts sweeping travel restrictions and business closures, and as major producers Saudi Arabia and Russia engage in a price war.

"There is just extreme volatility in the market now as participants try to assess the economic impact of the coronavirus and what it means for oil demand," Daniel Hynes, at Australia & New Zealand Banking Group, said.

"The high level of uncertainty around the hit to demand means that markets are going to continue to test these levels and invite some sort of reaction from producers." (AFP)

______________________________