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Asia Stocks Recover While Coronavirus Death Toll Crosses 1,000 In China, WHO Warns Other Countries

Neer Varshney

Markets in Asia recovered on Tuesday after Monday's drop even as the novel coronavirus shows no immediate signs of containment.

What Happened

The death toll from the virus has risen to 1,011, according to official numbers posted by state-run Xinhua News Agency, with more than 42,300 cases confirmed.

The spread of the virus remains mostly limited to mainland China, with only two deaths reported outside the country, including one in Hong Kong and one in the Philippines. 

The Centers for Disease Control and Prevention confirmed the 13th case of the virus in the United States late Monday. The infected person was one of the people evacuated from Wuhan.

The United Nations World Health Organization, which declared the coronavirus to be a public health emergency late January, issued a warning to other governments on ensuring that the virus doesn't find footing in their countries. "The [coronavirus] spread outside China appears to be slow now but could accelerate," the WHO director-general Tedros Adhanom Ghebreyesu said on Twitter on Monday.

"Containment remains our objective, but all countries must use the window of opportunity created by the containment strategy to prepare for the virus's possible arrival."

Meanwhile, financial institutions have expressed confidence that the effects of the virus on the markets, in particular outside China, would be limited.

Goldman Sachs analysts said in a note Monday that the effect of the outbreak on the United States markets would be limited. "Investors who believe the economic consequences of the coronavirus would be limited should increase exposure to cyclical and value stocks," the analysts said, as reported by MarketWatch.

An analyst from Chase Investment Counsel told Reuters that the effect of the coronavirus will be limited to the first quarter of the financial year, and the markets will likely stage recovery in the next quarters.

Markets in China have traded mostly up since the initial massive sell-off as the markets reopened after the extended Lunar New Year holiday.

The Chinese authorities have continued to assure investors that the impact of the virus is short-lived, and the banking authority provided a stimulus to the economy earlier this month through cutting reverse repo rates. Chinese president Xi Jinping made similar assurances in a televised address on Monday, Xinhua reported.

Asia Stocks

China's Shanghai Composite index closed 0.39% higher at 2,901.67; Shenzhen Component closed 0.37% higher at 10,768.63.

Hong Kong's Hang Seng Index closed 1.26% higher at 27,583.88.

South Korea's KOSPI closed 1% higher at 2,223.12.

Japan's benchmark index Nikkei 225 was the only major index in red, closing 0.60% lower at 23,685.98.

India's NIFTY 50 traded 0.84% higher at 12,134.30 and SENSEX was up 0.75%. Singapore's Straits Times Index was up 0.44% at 3,177.14.

Australia's S&P/ASX 200 index closed 0.61% higher at 7,055.30, while New Zealand's NZX 50 was up 1.13% at close.

US Futures

The U.S. futures pointed towards another higher open on Tuesday. NASDAQ 100 futures were up 0.27% at 9,553.25.

Dow Jones futures traded 0.17% higher at 29,294. S&P 500 futures were up 0.15% at 3,358.

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