HONG KONG (Nikkei Markets) -- Hong Kong stocks retreated on Monday as concerns over rising cases of new coronavirus infections across large parts of the world continued to alarm investors, prompting them to move further away from asset classes seen as risky.
The Hang Seng Index slumped 3.8% to 21,949.30 by noon, looking set to give up most of the gains recorded on Friday, when the 50-stock index jumped more than 5%. London-headquartered lender HSBC Holdings tumbled 5.7%, and power-tools maker Techtronic Industries plunged 10.5%. Property developer CK Asset Holdings shed 7.6%.
Regional markets were awash in red ink, as were U.S. equity index futures, pointing to likely steep losses on Wall Street later in the day. Millions of people across major world cities have been asked by authorities to stay indoors to control the pandemic, which has so far infected more than 330,000 people and killed nearly 15,000, intensifying worries that the outbreak would drag the global economy into a recession.
S&P Global Ratings said in updated estimates that the total and permanent income loss for Asia-Pacific from the virus, which causes the COVID-19 disease, is approximately $620 billion.
Michael Strobaek, global chief investor officer at Credit Suisse, wrote in a note that with markets still fragile, it was "too early to re-enter risk assets in any significant manner because the sell-off" was likely not over given the evolution of the pandemic.
Stanley Chik, head of research at Bright Smart Securities, advised investors to not be aggressive, "given that surges and plunges have become norms."
"The outbreak in Europe and the U.S. isn't in control yet, plus major cities such as London and New York are locking down. That could hit the economy hard," he said. "The financial market this week will inevitably continue to see volatility."
In the wider region, the Shanghai Composite Index gave up 1.6%, while the Nikkei Asia300 Index of regional companies outside Japan skidded 4.9%.
Supply-chain manager Li & Fung soared 94% to HK$0.97 after saying late on Friday that it had received a privatization proposal from a company backed by its founders at a price of HK$1.25.
Anhui Conch Cement gained 2.2% after reporting 2019 results, recording a 12.6% increase in its net profit.
Zhejiang Expressway edged 2.9% higher after posting higher net profit and revenue for 2019.
Major property developer China Evergrande Group plunged 14.4% after issuing a profit warning, saying it expects to report a 48% decrease in 2019 net profit. Its subsidiary Evergrande Health Industry Group sank 7.6% after warning of a wider net loss for last year.
China Merchants Bank slumped 6% amid broad market weakness despite reporting a more than 15% increase in last year's net profit.
-- Benny Kung