Chinese Stock Market Plunges Due to 'Wuhan Pneumonia'... Shanghai, Shenzhen, and Others Close Down 3% (Comprehensive)

[Image source=AP Yonhap News]

[Asia Economy Reporter Jeong Hyunjin] Due to the global spread of the novel coronavirus infection originating in Wuhan, China, and the decision to lock down Wuhan, major Chinese stock markets plummeted by more than 3% on the 23rd.

On that day, the Shenzhen Composite Index plunged 3.45% (62.80 points) compared to the previous trading day, closing at 1756.81. The Shanghai Composite Index fell 2.75% (84.23 points) to close at 2976.53. The CSI300 Index, which focuses on large-cap stocks, also closed down 3.10%. The Hong Kong Hang Seng Index dropped 1.73%.

The reason for the sharp decline in Chinese stocks is that the novel coronavirus infection originating in Wuhan is rapidly spreading to the United States, South America, Asia, and other regions, and the Chinese government decided to lock down Wuhan. Investors, who experienced the 2003 Severe Acute Respiratory Syndrome (SARS) crisis that paralyzed all of China due to initial response failures, grew increasingly anxious.

In particular, the World Health Organization (WHO) held an emergency board meeting on the 22nd (local time) to consider declaring the Wuhan pneumonia outbreak an international public health emergency, raising concerns about its potential impact on the global economy. The WHO postponed the decision to declare an emergency by one day due to insufficient information.

The WHO declares an international public health emergency only in cases of serious infectious diseases. Once declared, countries are advised to refrain from trade and travel with the affected country, and an international medical response system is established. Consequently, concerns have arisen that the Chinese economy, which has significant influence on the global economy, could be adversely affected.

Additionally, earlier on the same day, the Wuhan Novel Coronavirus Control and Response Emergency Center announced through state media that all public transportation in the city would be completely suspended from 10 a.m., which also impacted financial markets. Not only city buses and subways but also long-distance public transportation routes were temporarily halted. Wuhan Airport and train stations were also temporarily closed.

Not only China but also major Asian stock markets such as South Korea and Japan were affected. South Korea’s KOSPI index closed at 2246.13, down 0.93% (21.12 points) on the day. The KOSDAQ index also closed down 0.39%. Japan’s Nikkei 225 and TOPIX indices fell 0.98% and 0.78%, respectively.

This content was produced with the assistance of AI translation services.