Lots of investors are worried about the way stock markets are going down across the world and the future of their investments due to this virus.
The previous virus outbreak of this scale was the SARS virus in 2003, but the circumstances were different then markets across the world had been suppressed for quite some time and China wasn’t such a strong global player. It led to a significant correction in the markets especially in South-East Asia; but then later, there was a very strong rally across the world when the virus subsided. Similar scenario seems to be playing out now – the difference being that China is a much bigger player well embedded in global value chains and a large consumer of commodities. For India, China is also a source of big inputs in pharmaceuticals, electronics, and chemicals.
Of course, whenever such a ‘pandemic’ is in full force, the uncertainties create panic. Discussions with medicos indicate that this virus starts losing its potency quickly in warm season. So, we feel that this is a transitory phase which just needs to be gone through, maybe even providing good buying opportunities. As time passes, countries gear up their act, weather across the globe becomes warmer and some complete or partial anti-virus solution is found, this too shall pass.
Rajiv Sanoriya, Humfauji Gurgaon