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Economic News: Chinese State Media Urges Investors Not to Panic

Economic News: Markets Plunge on Coronavirus Fears; Chinese State Media Urges Investors Not to Panic

State media outlets in China urged investors not to panic following a plunge in mainland markets on Monday. Markets experienced the fall due to concerns over the new coronavirus outbreak.

Chinese markets traded for the first day on Monday after the government extended the Lunar New Year closure for financial markets to stem the spread of the virus.

The Shanghai composite closed at 7.72% lower. The Shenzhen composite dropped 8.41% and the Shenzhen component dropped 8.45%.

Security Times said it was normal to see large fluctuations in the market after a significant sudden event. Security Times is a backed by the government.

Historically, there have been many events that caused panic such as the Sept. 11 terror attacks and SARS outbreak — but they eventually proved to be a one-time impact on markets,” said the op-ed.

The new coronavirus has killed more than 420 people- the majority were in China. By the end of Monday, the Chinese National Health Commission had confirmed more 20,000 cases.

On Tuesday, China Securities Journal- another state-affiliated media said in an op-ed that the market decline was a “black swan” even that would not alter China’s long-term fundamentals.

The journal added the most detrimental economic impact of the virus’s outbreak would be felt in the first quarter. However, the Chinese economy could stabilize with government support after that.

Looking at the longer-term … there’s no need to overestimate the impact of black swan events — such as a sudden public health threat — on the financial markets,” the paper said.



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