Chinese investor sentiment also has been buoyed by promises of lower interest rates, tax breaks and other aid to help revive manufacturing and other industries.
The Kospi in Seoul fell 3.3 per cent to 1,987.01 and Sydney's S&P-ASX 200 sank 3.2 per cent to 6,441.2. India's Sensex skidded 3.6 per cent to 38,331.87. New Zealand and Southeast Asian markets also retreated. Investors came into 2020 feeling confident the Federal Reserve would keep interest rates at low levels and the US-China trade war posed less of a threat to company profits after the two sides signed a truce in January.
"It is a race to the bottom for US indices," Jingyi Pan of IG said in a report. "It may still be too early to call a bottom given the uncertainty around the matter of the coronavirus impact." Most access to the city of Wuhan, a manufacturing hub of 11 million people at the centre of the outbreak, was suspended January 23. The Lunar New Year holiday was extended to keep factories and offices closed. The government told the public to stay home.
Saudi Arabia has banned foreign pilgrims from entering the kingdom to visit Islam's holiest sites. Italy has become the centre of the outbreak in Europe.