Bird Flu Contagion (or Scare) Spreads to Hong Kong Stock Exchange

Culling of Poultry in Shanghai

The first victims of bird flu are always the birds. In China more reported cases of H7N9 bird flu led to further closures of poultry markets and the culling of tens of thousands of chickens, ducks, quails and more. On the human side some 21 cases have been reported with six fatalities. An additional 190 suspected patients are under observation after exposure to bird flu patients.

To date there are no reported cases of human-to-human transmission. All illnesses and deaths occurred among those working near or purchasing live poultry. One woman fell ill having recently eaten quail. News reports weren’t clear if this was purchased live and prepared by her, or if she was simply dining on bad bird. Epidemiologists (and investors) will watch to see if H7N9 begins to mutate and spread from human-to-human. That’s when epidemics occur.  (Remember the closing credits to “Rise of Planet of the Apes“?)

Late last week there were reports of a young girl under quarantine in Hong Kong. She had recently returned from Shanghai and was showing similar symptoms. Following tests she was given the all clear (spare the modest influenza – normal strain).

Hong Kong’s government said it could not rule out the possibility of an outbreak in the city. (Source: South China Morning Post)

In Hong Kong there is great uncertainty. Government has stepped up border controls to try to stave off the risk of infection. Returning from Shenzhen on Saturday I experienced three sets of controls – one temperature check and two visual checks by health authority personnel. This is required as more than 275,000 people make this pedestrian border crossing on peak days.

Bird Flu Precautions

Uncertainty riles investors, and the Hong Kong Stock Exchange has suffered as a result. Ten years back during SARS the Hong Kong Stock Exchange fell 18 percent. Last week Hong Kong traders had a short trading week, with the exchange closed on Monday for Easter and Thursday for Ching Ming, or Tomb Sweeping, Festival. On the last trading day of the week the Hong Kong Stock Exchange fell 2.7% (exacerbated as well by looser Japanese monetary policy). Most heavily hit were aviation stocks. (See more on Reuters.)

Today the property developers are sagging on the Hong Kong Exchange, as weak sales over the weekend were pinned on concerns over bird flu (see Reuters).

Meanwhile China remains on alert for new cases, and is expressing confidence it can contain the contagion. In Hong Kong the improved border controls and dedication to public health and cleanliness will decrease the spread of the disease. Until then markets will respond to every sneeze with its own shudders.

Street Sweepers Keep Hong Kong Clean

 

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