SINGAPORE (Jan 21): The outbreak of a new SARS-like virus originating in Wuhan, the capital of China’s Hubei province, is putting Asian stock markets on edge.

By Jan 21, four people have died from the virus, as 15 Chinese medical workers were reported to have been infected after treating infected patients.

The World Health Organization has confirmed that the pathogen, known as 2019-nCoV, is being transmitted among humans.

It had been originally hoped that transmission of the virus was limited from animals to humans, as some of the first patients worked or shopped at a seafood market in Wuhan where live animals and wildlife parts were also reportedly sold.

“The outbreak of a SARS-like coronavirus in Wuhan is developing into a major potential economic risk to the Asia-Pacific region now that there is medical evidence of human-to-human transmission,” says Rajiv Biswas, chief economist for Asia Pacific at IHS Markit.

“With a number of Wuhan virus cases having already been detected outside of China, this outbreak is particularly concerning just as the Chinese New Year season gets underway, with millions of Chinese tourists travelling both within China and to many popular Asian tourist destinations, such as Thailand, Vietnam, Japan, Singapore and South Korea,” he adds.

Already, confirmed coronavirus cases have been identified in Thailand, Japan and South Korea.

“Asia will remember back to the origins of SARS outbreak and its adverse effects on economic activity in the region. It is, therefore, no surprise that both equities and oil are being marked lower across Asia today,” says Jeffrey Halley, senior market analyst for Asia Pacific at OANDA.

The way Halley sees it, the price action in Asia is “a window to the future” if the pneumonia outbreak escalates. “We would expect Asian equities, currencies, and also energy, to all come under pressure on lower growth fears for the region,” he adds.

As at 12pm on Tuesday, the benchmark Straits Times Index has tumbled 38.67 points, or 1.18%, to 3,241.42.

In contrast, fears of the spread of the Wuhan virus is giving some healthcare stocks a shot in the arm.

Healthcare names were the best performers in the MSCI China Index on Monday, with the sector rising 1.3%. Antibiotics makers Jiangsu Lianhuan Pharmaceutical Co, Shandong Lukang Pharmaceutical Co and Shenzhen Neptunus Bioengineering Co all climbed the 10% daily limit.

In Singapore, Healthway Medical Corporation, the private outpatient medical service provider with more than 80 clinics across the island, led the way on Tuesday, surging 42.9% to a new 52-week-high of 4 cents as at 12pm.

Shares in Medtecs International Corporation, the manufacturer and distributor of medical consumables for the healthcare industry, also ascended to a 52-week peak, jumping 26.9% to 6.6 cents as at 12 pm.

Meanwhile, AsiaMedic, a healthcare provider that focuses on the management of clinical services in the fields of disease prevention, early illness detection and advanced diagnostics, soared 23.1% to 1.6 cents.

Other healthcare counters, including Clearbridge Health, Singapore Medical Group, UG Healthcare Corporation, and Thomson Medical Group, were also among the biggest climbers for the day – rising 5.2%, 5.0%, 3.7%, and 3.2%, respectively.

Apart from the healthcare sector, however, IHS Markit’s Biswas warns that some other sectors of the economy could be “particularly vulnerable” to a SARS-like virus epidemic that can be spread by human-to-human transmission. These include retail stores, restaurants, conferences, sporting events, tourism and commercial aviation, he says.

“A key concern is the potential risk for the Tokyo Summer Olympics in July-August 2020,” Biswas adds. “Therefore, containing the current Wuhan virus outbreak has become a key priority for Chinese and international health care authorities, with enhanced screening of travellers now being put into place in many major airports worldwide.”