(Bloomberg) -- China’s deadly novel coronavirus outbreak is spreading further in Asia and parts of Europe, raising concerns about the prospect of a global pandemic and triggering declines in risk assets.
On Monday, China said its total number of virus cases had climbed past 77,000. In neighboring South Korea, the next hardest-hit country, the Kospi equity index fell 3% after Seoul reported 161 additional virus cases, along with two more fatalities, bringing the death toll there to seven.
The situation in Europe is also heightened following a weekend that saw Austria halt a train from Italy on concern there were two infected passengers on board. This came after Italy -- now the virus’s epicenter on the continent -- canceled the Venice Carnival (NYSE:CCL) and other events amid a rising case load.
Key Developments
- Guangdong latest Chinese province to lower emergency level
- Korea to send 1,000 hospital beds to virus-hit city, and expand screening
- Total number of cases in China reaches 77,150, up by 409
- Countrywide death toll rises by 150, to 2,592
- 149 more deaths, 398 new infections in province at epicenter, Hubei
- Kospi index declines most since Jan. 28
- South Korea says 161 more cases; death toll at 7
- Italy infections soar
- IMF’s Georgieva says outbreak puts recovery at risk
Another Chinese Province Lowers Emergency Level (11:33 a.m. HK)
State-run CCTV said Guangdong -- which has the most confirmed infections after Hubei -- has become the latest Chinese province to lower its coronavirus emergency response level from its highest.
Gansu, Liaoning, Guizhou, Shanxi and Yunnan also have, the state-run People’s Daily reported earlier, citing local governments. Shanxi’s was lowered to its second-highest, and the other four to the third-highest levels, the newspaper said.
South Korea Widens Virus Screening (11:05 a.m.)
With the country at the highest alert level in nearly a decade, South Korea will expand coronavirus screening to all residents of the city of Daegu who show symptoms of the infection, and ship 1,000 hospital beds to the region, a health ministry official said at a briefing.
The additional beds are being expedited as health officials said they had identified 37,000 people in the city with symptoms of the virus. The moves came a day after President Moon Jae-in raised the alert level in South Korea to its highest.
“There is high chance of nationwide spread if South Korea fails to effectively block the transmission of community spread in Daegu as confirmed cases have spiked in the region,” Vice Health Minister Kim Ganglip told the briefing.
South Korea on Monday reported 161 additional virus cases, raising the total to 763 infections, along with two more deaths.
By elevating the alert level, the government can restrict air travel, allocate additional resources to public and private hospitals and impose stricter measures on foreigners entering the country. South Korea on Sunday postponed the resumption of schools, which were scheduled to reopen next Monday after a winter break and restricted military personnel from leaving their base or facility.
When the last alert level was raised to “red” in 2009, the number of H1N1 cases in South Korea doubled to almost 9,000 in a week’s time, with about 40 deaths attributed to the influenza during the same period.
China Releases New Case Figures, Late (11 a.m. HKT)
The country’s death toll rose by 150 to 2,592 on Sunday, the National Health Commission said in a statement on its website. The total number of cases rose to 77,150, it said, months after the pathogen first emerged in Hubei province, where the bulk of the virus’ impact has been felt.
Hubei reported an additional 398 cases and 149 more deaths, according to the NHC. That brings the confirmed number of cases in the province to 64,287, and its death toll to 2,495. More than 24,700 patients have been discharged from hospitals since the outbreak began, the commissions said.
China was delayed in releasing its daily virus data, with numbers out of Hubei typically arriving between 6 and 7:30 a.m. local time. The newly appointed provincial party secretary there, former Shanghai mayor Ying Yong, on Friday ordered Hubei to not remove confirmed cases from its virus tallies.
The province’s methodology shifts over the past few weeks have raised questions over the reliability of the data, with a change on Feb. 13 adding almost 15,000 new cases to the list. The numbers were also revised on Friday to include cases in prisons that were omitted earlier.
Earlier last week, China advised Hubei to report cases only as “confirmed” or “suspected.” The province has been grappling with overcrowded hospitals and stretched medical resources.
Hong Kong Travel Agency Halts Tours to Seoul (10:52 a.m. HK)
HNA’s Hong Kong-based Hong Thai Travel Services halted group tours to Seoul departing before March 15 in order to ensure the health and safety of customers and staff amid the outbreak, the travel agency said in a post on its Facebook (NASDAQ:FB) page. It will impact 570 travelers from around 30 tour groups, who will be eligible for exchanges and refunds.
Five Chinese Provinces Lower Emergency Levels (9:30 a.m. HK)
Gansu, Liaoning, Guizhou, Shanxi and Yunnan provinces lowered their coronavirus emergency response levels, which had previously been at the highest level, according to the state-run People’s Daily, which cited local governments.
Shanxi’s was lowered to its second-highest, and the other four to the third-highest levels, the newspaper said.
Korea’s Ruling Party Urges Extra Budget (7:37 a.m. HK)
The Democratic Party of Korea assessed that the nation will need more than 10 trillion won ($8.3 billion) in extra budget to support the economy and provide aid for losses related to the outbreak, according to the Seoul Shinmun newspaper, citing an unidentified party official.
Cathay Slashes More Capacity (7:12 a.m. HK)
Hong Kong carrier Cathay Pacific Airways Ltd. will reduce around 40% of capacity across its network, an increase from the roughly 30% it announced earlier this month. The Asian cities of Jeju, Busan, Okinawa, Niigata, Kaohsiung and Taichung are among the destinations subject to temporary suspension until March 28, the airline said Saturday.
Aussie Drops as Caution Reigns in Markets (6:23 a.m. HK Monday)
Australian bonds climbed, while equity futures indicated a soft start across the Asia-Pacific. The Australian and New Zealand dollars weakened.
The virus outbreak’s “impact on Chinese business is already deep,” said Charles Gillams, managing director at RJMG Asset Management Ltd. “So, whether that has a one economic quarter impact -- of some severity -- or is a bigger issue remains unclear.”
Austria Stops Trains Coming From Italy (4:15 p.m. NY)
Austria’s state railroad halted three trains traveling from Italy via the Brenner Pass in response to a rash of virus cases in its southern neighbor, officials said.
Hong Kong Companies Have No Safety Net (4:05 p.m. NY)
That “Tsunami-like” event from the virus in Hong Kong is devastating businesses already hobbled by months of anti-government protests.
Unlike in the U.S. and rival Singapore, businesses in Hong Kong don’t have recourse to any corporate rescue procedure. The lack of a proper legal framework for bankruptcy protection means companies are forced into liquidation, according to Johnson Kong, the president of the Hong Kong Institute of Certified Public Accountants.
Air New Zealand Warns Coronavirus Will Hit Earnings (3:20 p.m. NY)
Air New Zealand is joining the pack of airlines warning that earnings will be affected. The carrier said Monday it expects a NZ$35 million ($22 million) to NZ$75 million hit as travel demand to Asia drops.
Airlines across the globe have been hit by the outbreak, from flight bans to loss of bookings to higher operating costs.
U.S. Trade Rep Says U.S. Offshored Too Much of Supply Chain (3 p.m. NY)
White House trade adviser Peter Navarro says the crisis shows, “not surprisingly,” that the U.S. has offshored too much of its supply chain.
Navarro expressed confidence on Fox’s Sunday Morning Futures, saying the “American economy is exceedingly strong and not particularly vulnerable to what happens in China.”
He emphasized his goal to bring more of the U.S. supply chain home. “A lot of it is in China, some of it is in India, some in Europe, but we’ve got to get that back on shore,” he said.
New Cases in Italy Reach 140 (2:20 p.m)
Italian authorities reported cases in three regions: 110 in Lombardy; 21 in Veneto and nine in Emilia Romagna. Of those, 25 are in intensive care. Italy reported its third death on Sunday, a woman in her 80s.
Long Ventilator Stays Strain China Hospitals (1:50 p.m. NY)
Critical care resources in central China are being strained by coronavirus patients needing a month or more on mechanical ventilators, a study finds. More than two-thirds of critically ill patients required invasive breathing support, doctors at the outbreak’s epicenter in Hubei province reported.
That burden could become more acute: More than 40,000 people are hospitalized with Covid-19 in Hubei. Among those, 8,853 cases are serious and 1,845 are critically ill.
Italy Reports Third Death (11:46 a.m. NY)
Italy confirmed a third death from the coronavirus. Prime Minister Guiseppe Conte said on RAI television he was confident the country can limit the contagion. The Lombardy region has entered into phase two of limiting and containing the spread of the virus, Lombardy health official Giulio Gallera said at a briefing in Milan.
La Scala opera house is among the public buildings that suspended performances as a precaution. It came after Venice canceled all public events for a week, including the remaining days of the city’s flagship Carnival (NYSE:CCL) celebration. Milan adopted similar measures, which will likely affect the rest of its Fashion Week.
Passengers Test Positive in U.K. (11:32 a.m. NY)
Four more patients have tested positive for the coronavirus in the U.K., Chief Medical Officer Chris Whitty said in a statement. They arrived in the country yesterday on an evacuation flight with 32 passengers from the quarantined Diamond Princess cruise ship from Japan and are being taken from the quarantine location to specialist NHS infection centers. The total number of cases in the U.K. is now 13.
EU Says More Containment May Be Needed (11:25 a.m. NY)
The European Centre for Disease Prevention and Control said more cases in Italy and the EU are expected in coming days. “These extraordinary measures in northern Italy are essential to limit the outbreak and may need to be replicated in other communities in the coming days,” it said in a statement. The ECDC is monitoring the situation and will issue an updated risk assessment with the next 24 hours.
Virus Could Put Recovery at Risk: IMF (8:55 a.m. NY)
The virus outbreak has disrupted economic activity in China and could put global economic recovery at risk, Kristalina Georgieva, managing director of the International Monetary Fund, said in a statement after the G-20 meeting. “Even in the case of rapid containment of the virus, growth in China and the rest of the world would be impacted,” Georgieva said. “We all hope for a V-shaped, rapid recovery—but given the uncertainty, it would be prudent to prepare for more adverse scenarios.”
Third Diamond Princess Passenger Dies (7:07 a.m. NY)
A third passenger from the Diamond Princess cruise ship docked in Yokohama died, Japan’s health ministry said in a statement, citing pneumonia as the cause of death. The victim was a Japanese man was in his 80s.
Iran Reports Eighth Deaths, 43 Cases (6:19 p.m. HK)
The number of infected people has reached 43, including the eight fatalities, Kianoush Jahanpour, a spokesperson for the health ministry, said on state TV. Iran has the highest number of coronavirus cases in the Middle East. Seven of the new infections are in Qom, the epicenter of the outbreak in the country, four in Tehran, and the others in Gilan, Mazandaran and Markazi provinces, he said. Kuwait stopped ships from Iran calling at its ports.
China Central Banker Sees Limited Economic Impact (11:56 a.m. HK)
China has sufficient policy scope to address the impact of the coronavirus on the economy, which will prove limited, according to People’s Bank of China Deputy Governor Chen Yulu, the central bank said in a posting Sunday. Chen in a Financial Times column Feb. 20 wrote that China will probably see a “V-shaped” recovery.
(An earlier version corrected South Korea item and bullet to note that Korea will send 1,000 hospital beds to Daegu.)
