Asia report: Markets plunge again after Trump's coronavirus travel ban

Markets in Asia were red across the board on Thursday, with the Tokyo benchmark falling into bear market territory, as investors reacted to a global tightening of measures in a bid to combat the Covid-19 coronavirus pandemic.

In Japan, the Nikkei 225 was down 4.41% at 18,559.63, as the safe-haven yen strengthened 0.77% against the dollar to last trade at JPY 103.73.

The fall on the benchmark index took it more than 20% lower than its 52-week peak, which means it was now in bear market territory.

Of the index’s major components, automation specialist Fanuc was down 4.31%, fashion firm Fast Retailing lost 5.6%, and technology conglomerate SoftBank Group was off 6.27%.

Airlines were under serious pressure in Japan after the announcement of a ban on European travellers to the United States, with ANA Holdings down 5.63% and Japan Air Lines down 7.03%.

The broader Topix index was down 4.13% by the end of trading, ending the day at 1,327.88.

On the mainland, the Shanghai Composite was 1.52% weaker at 2,923.49, and the smaller, technology-heavy Shenzhen Composite lost 2.2% to close at 1,818.56.

South Korea’s Kospi was 3.87% weaker at 1,834.33, while the Hang Seng Index in Hong Kong fell 3.66% to 24,309.07.

Both of the blue-chip technology stocks were once again weaker in Seoul, with Samsung Electronics down 2.5%, and chipmaker SK Hynix losing 3.16%.

Korean Air Lines was down in the wake of the US traveller ban, falling 4.62%, while Hong Kong-traded shares in China Southern Airlines were 3.2% weaker.

Overnight, the World Health Organisation declared the Covid-19 outbreak officially a global pandemic, sending stocks on Wall Street tumbling by Wednesday’s close.

The Dow Jones Industrial Average fell more than 1,400 points, taking it into bear market territory from the record high close that was only set in February.

After markets closed stateside, US president Donald Trump gave an address, announcing a 30-day ban on all travellers from Schengen Area countries in Europe from entering the United States.

He also said he would officially ask Congress to approve payroll tax relief in a bid to keep the country’s economy afloat.

Spreadex analyst Connor Campbell said Trump’s travel ban had sent investors fleeing equities, with his coronavirus strategy "provoking another intense round of blood loss" for stocks.

"This announcement came alongside a series of measures valued at $250bn - much of which will be pumped into the financial system to ease liquidity issues - designed to cushion the blow of the virus.

"Hot on the heels of the World Health Organization declaring a pandemic, and with the UK preparing to enter a phase of ‘social distancing’, to say Trump’s plans were greeted with scepticism is an understatement.

“Taking the view that the president’s travel ban has only further heightened the likelihood of a global recession, while suggesting the stimulus plan lacks the necessary force to combat the impact of the outbreak, investors fled a market landscape that increasingly looked like a crime scene.”

Oil prices were in a serious slide at the end of the Asian day, with Brent crude last down 6.14% at $33.72 per barrel, and West Texas Intermediate off 5.84% at $31.16.

In Australia, the S&P/ASX 200 plunged 7.36% to 5,304.60, as Qantas Airways plummeted 9.9% after Trump announced the traveller ban to the US.

Across the Tasman Sea, New Zealand’s S&P/NZX 50 slid 4.97% to a nine-month low of 10,333.27, with majority state-owned carrier Air New Zealand sliding 8.3%.

Tourism Holdings was 7.1% weaker, with the company warning the travel ban would have an “immediate” effect on New Zealand, given many travellers from Europe arrive via the US.

Both of the down under dollars were weaker on the greenback, with the Aussie last off 1.26% at AUD 1.5616, and the Kiwi retreating 0.6% to NZD 1.6047.