Shanghai and Shenzhen open in sharp decline after a week. Steps taken by Chinese authorities have proven insufficient to shield the economy. The Chinese tourism industry lost US$ 144 billion over the Lunar New Year holidays.
Beijing (AsiaNews/Agencies) – Fears over the Wuhan coronavirus triggered a sharp fall in Chinese shares when markets reopened today after the Lunar New Year holiday.
The Shanghai Shenzhen stock exchanges lost about 8 per cent lower, its biggest daily drop for more than four years.
Steps announced yesterday by Chinese authorities did not prevent the stock crash. The People's Bank of China (PBOC) pumped 1.2 trillion yuan (US$ 174 billion) into financial markets today, and lowered short-term interest rates.
The injection is one of 30 measures announced by various authorities this weekend to counter the effects of the coronavirus outbreak.
China’s securities watchdog on Sunday said that the virus outbreak would only have a short-term impact on stock markets.
In mainland China, the outbreak has killed at least 304 people so far and infected about 14,380 more, causing losses estimated at trillion yuan (US$ 144 billion) for the service sector during this holiday period.
Economists now forecast China’s economic growth to drop below 5 per cent in the first three months of the year, down from 6 per cent in the fourth quarter of 2019.
Many warn that the downward trend may continue into the second quarter, hitting small businesses hard.
Meanwhile, the effects of the virus are now beginning to be felt outside of China. In Singapore, which has confirmed 18 cases of the Wuhan coronavirus, the authorities have waved licence fees for hotels, travel agents and tour guides to help the tourist sector.