SHANGHAI — Spreading coronavirus outbreaks in Italy and in South Korea over the weekend incited broad slides in stock markets on Monday, as investors appeared to fear that the economic disruption already seen in China might affect other economies as well.
The South Korean market ended 3.9 percent lower, after a surge in cases of the coronavirus disease prompted President Moon Jae-in on Sunday to put the country on its highest level of alert.
Futures markets trading suggested that European stock markets would also slump more than 2 percent when they open. The Italian government locked down at least 10 towns over the weekend near Milan, the country’s financial capital and a key industrial center, after scores of new cases emerged there.
Futures markets suggested Wall Street was headed to a rough Monday opening as well.
Stock markets in Asia dropped beyond South Korea, although somewhat less. The Australian market fell over 2 percent. The Hong Kong market was trading 1.8 percent lower on Monday afternoon, while the Singapore market was down a little more than 1 percent.
Stock markets in mainland China seemed mostly immune on Monday to the sell-off elsewhere. The Shanghai stock market was down only slightly. In southeastern China, the tech-heavy Shenzhen stock market was actually up nearly 1 percent by early afternoon on Monday there.
“The worse the virus outbreak, the better the chance the central bank will release” more money into the financial system, which would tend to support share prices, said Hao Hong, the research director for the international operations of China’s Bank of Communications.
The Chinese authorities have also appeared to prop up the country’s domestic stock markets in recent days. That action followed a steep slide when they first reopened following the Lunar New Year holiday, which the Chinese government extended in an effort to stop the outbreak.
The Chinese government has told fund managers that if they sell shares, they must buy a slightly greater number of shares, Mr. Hong said.
The stock market in Japan was closed on Monday, a public holiday there in honor of the emperor’s birthday.
The coronavirus epidemic in China has already severely curtailed economic growth in China. That has fanned concerns that other economies may also be harmed as the virus spreads further.
Factories in China have been slow to reopen and resume full production even a month after Beijing publicly acknowledged the severity of the epidemic by locking down Wuhan, a city of 11 million people. That is partly because mass quarantines have prevented many employees from returning to their jobs.
Demand in China has also collapsed at least temporarily for a wide range of goods, limiting the incentive for business owners to restart production. Auto sales plummeted 92 percent in China during the first two weeks of February compared to the same time last year.