Asian stocks tumble as China virus worries deepen

Asian shares skidded again Tuesday on deepening worries over the expanding outbreak of a new virus in China.

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Markets in Hong Kong, Taiwan and mainland China were closed Tuesday for Lunar New Year holidays, while South Korea's benchmark tumbled 3.1% to 2,176.72 as it reopened after its own holidays.

Japan's Nikkei 225 index lost 0.6% to 23,215.71, while Australia's S&P ASX/200 slipped 1.4% to 6,994.50. Singapore's benchmark dropped 2.2% and Jakarta's fell 0.5%. But shares rose in Thailand and in India, where the Sensex was up 0.2% at 41,217.00.

A currency trader wearing a mask watches a calendar at the foreign exchange dealing room in Seoul. AP

China has extended its national holiday by three days so that offices should reopen on Monday.

Overnight, a sell-off on Wall Street gave the Dow its first 5-day losing streak since early August and handed the S&P 500 its worst day since early October. The latest bout of selling on Wall Street came after China announced a sharp rise in cases of the virus.

"How long and how deep the correction lower will last, depends both on the success of China's efforts to control the viral spread, and the prevalence of its occurrence internationally," Jeffrey Halley of Oanda said in a commentary.

Airlines, resorts and other companies that rely on travel and tourism suffered steep losses. Gold prices rose as did bonds as traders sought refuge in safer holdings.

"Over the weekend you saw more cases,” said Quincy Krosby, chief market strategist at Prudential Financial. "That got investors and traders worried that this may be a longer event. The next question is, 'What happens to global growth if this does continue and magnify?'"

The Dow Jones Industrial Average fell 453.93 points, or 1.6%, to 28,535.80. The Dow had been down nearly 550 points. The S&P 500 index dropped 51.84 points, or 1.6%, to 3,243.63. The Nasdaq lost 175.60 points, or 1.9%, to 9,139.31. The Russell 2000 index of smaller company stocks gave up 18.09 points, or 1.1%, to 1,644.14.

The virus has spread to a dozen countries, including the U.S. Besides the threat to people's lives and health, investors are worried about how much damage the virus will do to profits for companies around the world.

Associated Press