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China Market drops after spike in virus death cases

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Capital Market
Last Updated : Feb 13 2020 | 6:50 PM IST
Mainland China equity market finished session lower on Thursday, 13 February 2020, snapping seven sessions of winning steak, as inbestors booked recent gains after reports stated a sharp jump in the death toll from the coronavirus. At closing bell, the benchmark Shanghai Composite Index declined 0.71%, or 20.83 points, to 2,906.07. The Shenzhen Composite Index, which tracks stocks on China's second exchange, fell 0.77%, or 13.72 points, to 1,771.61. The blue-chip CSI300 index was down 0.62%, or 24.51 points, to 3,959.92.

China's Hubei province on Thursday reported a spike in the number of new coronavirus cases. It said it started to include clinically diagnosed cases in its tally. The death toll in China's Hubei province, the epicentre of the flu-like virus outbreak, rose by 242 to 1,310 as of Wednesday. A record 14,840 cases were reported in Hubei on Thursday, from 2,015 new cases nationwide a day earlier, under a new method for diagnosing cases.

Market sentiment had been positive earlier in the week as the data had been showing an apparent slowdown in the pace of new reported cases, with policymakers in China having announced a series of measures to combat the expected economic slowdown from the virus outbreak.

Beijing ordered local authorities to kick-start economic activities and resume production while containing the spread of the coronavirus. Local governments were urged to offer temporary support to small enterprises, while banks were advised to keep interest rates low

Apple AirPod supplier Luxshare Precision Industry declined 2.2% to 44.1 yuan and liquor distiller Kweichow Moutai dropped by 0.6% to 1091.0 yuan.

A gauge tracking medical waste treatment stocks in mainland markets jumped on demand from hospitals and health care sectors due as outbreak containment efforts increased. Qiaoyin Environmental Tech rose nearly 10% - the daily limit - to 22.7 yuan. JS Rainbow Heavy Industries also gained close to 10% at 5.7 yuan.

CURRENCY NEWS: China's yuan edged down after the numbers of newly confirmed cases and deaths were beyond market expectations. Prior to market opening, the People's Bank of China set the midpoint rate CNY=PBOC at 6.9785 per dollar, 67 pips weaker than the previous fix of 6.9718. The offshore yuan CNH=D3 was trading at 6.982 per dollar, while onshore spot yuan changed hands at 6.9804, some 86 pips weaker than the previous late session close.

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First Published: Feb 13 2020 | 6:35 PM IST

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