400+ outbreaks of the Coronavirus and counting, via Bloomberg
Mark Cranfield from Bloomberg's MLive blog out with a throwback to 2003 and the SARS outbreak and how the S&P 500 responded. As a quick reminder the SARS outbreak of 2003 resulted in a confirmed total of 8,098 cases, according to the World Health Organisation, and 774 deaths. The first case began 16 November 2002 and fear begun to pick up in January 2003.
I came across one fascinating infograph that shows just how infectious SARS could be with one patient (who sadly died) who passed on the virus across his hotel floor.
So, you can see why risk markets are concerned about a rapidly spreading, dangerous virus. The number of cases has now risen well above 400 confirmed cases (it was 224 cases this time yesterday morning) and that number should sadly rise with the Lunar New Year travel movements. Double the number in 24 hours is a bug increase and watch out for risk tilting off strongly again if these numbers increase over the next 24 hours at a similar rate.
Learning from SARS
By the time that SARS had really dragged down equities the S&P 500 bounced back more quickly than the MSCI Asia Pacific Index. Now in the previous case of SARS it would be well to point out that only 8 cases were confirmed in the US. So, it wasn't ever a major American problem. Hence the quick bounce. So, keep history in mind as we await further news as the virus is attempted to be contained. Market expectations are for this virus to play out similar to the way the SARS virus did in 2003.