Warren Buffett advises investors not to 'buy or sell' on coronavirus headlines

Billionaire investor Warren Buffett said on Monday that people should not let the coronavirus panic influence their decisions when it comes to buying or selling stocks.

His advice comes as global stocks plunge on Monday after a weekend of apparently escalating outbreaks outside of China, particularly in Italy, South Korea and Iran.

“The real question is: ‘Has the 10-year or 20-year outlook for American businesses changed in the last 24 or 48 hours?’” the billionaire investor said on CNBC.

“You’ll notice many of the businesses we partially own, American Express, Coca-Cola — those are businesses and you don’t buy or sell your business based on today’s headlines. If it gives you a chance to buy something you like and you can buy it even cheaper then it’s your good luck,” he added.

Buffett emphasised the long term outlook for equities, predicting a high chance that they would continue outperform bonds if tax rates were kept low.

“If something close to current rates should prevail over the coming decades and if corporate tax rates also remain near the low level businesses now enjoy, it is almost certain that equities will over time perform far better than long-term, fixed-rate debt instruments,” he said.

As of 1518 GMT, the Italian FTSE MIB was leading Europe's main stockmarket gauges lower due to the coronavirus outbreak, retreating by a massive 6% to 23,305.81.

Asian markets were also rocked overnight, with South Korea’s top flight Kospi index shedding -3.87% to 2,079.04 and Hong Kong’s Hang Seng trading down -1.79% to 487.93.