South Korea stocks plunge as country raises coronavirus alert to ‘highest level’

South Korea stocks plunge as country raises coronavirus alert to 'highest level'

Stocks in South Korea plunged in Monday morning trade after the country raised its coronavirus alert to the “highest level” following a recent spike in cases throughout the country.

The Kospi was down more than 2% in early trade while the Kosdaq fell 2.25%.

The disease has taken at least five lives in South Korea so far, according to the country’s Centers for Disease and Control and Prevention on Sunday. A recent jump in the number of cases in South Korea has brought the total infected to more than 600, the country with the most cases outside the mainland.

Industry heavyweight Samsung Electronics announced Saturday that a coronavirus case had been confirmed at a mobile device factory complex in South Korea, resulting in the shutdown of the entire facility until Monday morning, according to Reuters. The affected factory reportedly accounts for a small portion of Samsung’s total smartphone production. Samsung Electronics shares were down more than 2.5% in early trade.

Meanwhile, shares in Australia fell in morning trade, with the S&P/ASX 200 down more than 1.8% as almost all the sectors declined. The energy subindex fell about 3% as shares of oil companies fell. Santos plunged 2.65% while Woodside Petroleum plummeted about 5%.

Overall, the MSCI Asia ex-Japan traded about 0.7% lower.

Markets in Japan are closed on Monday for a holiday.

Developments surrounding the new coronavirus, known as COVID-19, will continue to be monitored by investors as they attempt to ascertain the potential economic impact of the disease.

“COVID-19 news remain front and centre in investors’ minds with a jump in news cases reported outside China, from South Korea, the Middle-East and Italy,” Rodrigo Catril, senior foreign exchange analyst at National Australia Bank, wrote in a morning note.

“News over the weekend will not have helped sentiment as we begin the new week, with the number of cases surging to over 600 in South Korea and over 130 in Italy. Extraordinary containment measures are being implemented, which will increase the hit to the global economy,” Catril said.

Currencies and oil

The U.S. dollar index, which tracks the greenback against a basket of its peers, was last at 99.428 after seeing highs around 99.9 last week.

The Japanese yen traded at 111.50 per dollar following a weakening from levels below 110.4 in the previous trading week. The Australian dollar was at $0.6605 after declining from levels above $0.67 last week.

Oil prices plunged in the morning of Asian trading hours, with international benchmark Brent crude futures down 2.72% to $56.91 per barrel. The U.S. crude futures contract also dropped 2.49% to $52.05 per barrel.

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