Market reaction to the Coronavirus has shown similarities to the SARS epidemic of 2003. The Hong Kong Hang Seng index bottom during SARS coincided with the peak of media mentions on the virus and being featured on the cover of The Economist magazine. This illustrates how markets are often headline driven. The ultimate course of the Coronavirus is impossible to predict but one can expect it to result in a weaker Chinese currency and slower Chinese growth but should not require wholesale portfolio adjustments at this point.
Chart and photo source: Bloomberg