"Fear of Infectious Diseases Since 2000, Limited Impact on Stock Market... Focus on Fundamental Changes"

[Asia Economy Reporter Oh Ju-yeon] The 'Wuhan Pneumonia (Novel Coronavirus Infection)' that started in Wuhan, Hubei Province, China, is spreading worldwide, causing anxiety in global stock markets. However, an analysis suggests that since 2000, global infectious disease fears have not changed the direction of the economy, and attention should be paid to fundamental changes.

On the 27th, Lee Kyung-min, a researcher at Daishin Securities, said, "In the short term, global stock markets are likely to continue to experience instability due to the Wuhan Pneumonia issue," but added, "Since 2000, the impact of infectious disease outbreaks on the global economy and stock markets has been limited."

The researcher diagnosed, "To limit infectivity and spread, people refrain from outdoor activities, which suppresses consumer sentiment, and fears that it will negatively affect not only tourism but also global trade and the economy are shaking global stock markets amid the worldwide spread of infectious diseases."

He continued, "Considering that global stock markets are already experiencing heightened caution due to short-term overheating and valuation burdens, volatility expansion should be guarded against. Especially, if the spread within China accelerates after the Lunar New Year holiday, fear will inevitably be maximized."

The noteworthy point is the actual impact of infectious disease fears on the global economy and stock markets.

The researcher analyzed that since 2000, global infectious disease fears have not changed the direction of the economy. The stock market continued its existing trend after short-term volatility expansion.

He said, "Since the outbreak of AIDS in 1981, there have been 13 infectious disease outbreaks worldwide," and "The stock market returns (based on global stock markets) one month, three months, and six months after the outbreaks were 0.44%, 3.08%, and 8.50%, respectively."

He added, "Recently, global fundamentals have been showing signs of recovery," emphasizing, "The US-China trade agreement and global economic stimulus policies will support further fundamental improvements, and from a strategic perspective, attention should be paid to fundamental changes."

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