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Nikkei Markets

Asian stocks rebound as China moves to contain virus

Hyundai Motor jumps after quarterly profit beats estimates

HONG KONG (Nikkei Markets) -- Asian shares outside Japan rebounded Wednesday as Chinese officials unveiled measures to contain the outbreak of a deadly virus.

The Nikkei Asia300 index of companies outside Japan advanced 0.7% to 1,408.77 after falling about 2% yesterday. The recovery was led by mainland companies. An index of Chinese companies listed in Hong Kong added 1.9% after plunging more than 3% in the previous session. China Eastern Airlines paced the rebound in airline shares, adding 2.9%. Tencent Holdings rose 1.5% and China Vanke climbed 3.2%.

Amid increasing worries over the coronavirus that originated in central China, the nation's officials Wednesday said they will be taking measures to contain its spread. China will begin nationwide screening, and authorities are stepping up the monitoring of transportation links, Bloomberg reported. Further, the country's health commission said China will publish new cases of the virus nationwide daily throughout the Lunar New Year break and so far there was no evidence of "super spreaders," according to a Reuters report.

As of yesterday, 440 people in 13 Chinese provinces had been infected and nine people died, officials said.

"The swift and transparent response from authorities will most likely prevent an epidemic, but investors fear the coming Lunar New Year and associated travel could breach the containment strategies," Michael McCarthy, the chief market strategist at CMC Markets and Stockbroking, said.

The Lunar New Year celebration, which witnesses travel by millions of Chinese citizens, begins later this week.

In other movers on the A300 on Wednesday, Hyundai Motor jumped 8.5%. The South Korean carmaker reported fourth-quarter operating profit exceeded estimates of analysts polled by Reuters.

Hyundai Glovis, the logistics arm of Hyundai Motor Group, rose 1% after saying that its fourth-quarter net profit increased 24%.

South Korea's benchmark equity index added 1.2%. Data released Wednesday showed that the country's GDP grew by 2.2% in the fourth quarter, better than the 1.9% expected by economists polled by Reuters.

Krung Thai Bank added 2.5% after saying that December quarter net profit increased 21%.

Top Glove and Hartalega Holdings continued the broad rally in Malaysian glove manufactures, surging 6.3% and 4.3%, respectively. Bets of a spike in glove demand following the virus outbreak in China were driving the shares higher, traders said.

Meanwhile, the Malaysian central bank on Wednesday unexpectedly cut the benchmark policy interest rate by 25 basis points to 2.75% in move to support economic growth.

--Nimesh Vora

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