As coronavirus outbreak in China becomes an epidemic, economic sectors suffer as bad as health sectors. Reportedly, investors halt investing in tourism.
Accordingly, major hotel operators BTG Hotels Group Co and Shanghai Jin Jiang International Hotels Development Co’s stocks dropped by 7% on Monday morning. Meanwhile, the stocks of tourism company Songcheng Performance Development Co were down more than 8%.
Furthermore, investors move to pharmaceutical and facial mask industries. Drugmakers such as Jiangsu Sihuan Bioengineering Co and Shandong Lukang Pharmaceutical Co gained more than 10%.
Regarding the investment reaction, this is identical to the outbreak happening in China in 2003. At that moment, there was another outbreak of Severe Acute Respiratory Syndrome (SARS).
“If you look at how investors reacted to SARS, today’s outbreak certainly gives a short-term boost to drugmakers and facial mask producers,” said the head of equity trading at Shanshan Finance, Wu Kan.
Moreover, health experts discover that the new coronavirus belongs to the same family tree of coronaviruses that prompted SARS. Accordingly, the 2003 SARS plague, also started in China, killed approximately 800 lives.
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Coronavirus Outbreak in China
Pertaining to the outbreak, China recently confirmed 139 new cases of pneumonia. Among them, the death toll already reaches three.
The virus is believably originated from the Huanan Seafood Wholesale Market, Wuhan. The latest update indicates that the plague has spread beyond the city.
On Monday, Wuhan Municipal Health Commission announced that 136 new patients were diagnosed on Saturday and Sunday. Among them, one person died, two are critical, while 33 are in serious condition.
In addition, recent confirmation from foreign countries suggests that the coronavirus has breached beyond the wall of China. Accordingly, two cases are in Japan, and one happens in Thailand and South Korea respectively.
Despite everything, Chinese scientists currently have very limited information pertinent to the virus. Of those, the extent of its destructive impact and the way it transmits remain unknown.
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