GLOBAL MARKETS-Asian stocks extend losses as pandemic fears grow

GLOBAL MARKETS-Asian stocks extend losses as pandemic fears grow

* Stock slide slows, but losses grow
* Nikkei down 1%, Australia down 0.5%, E-minis drop
* U.S. crude at one-year low
* Asian stock markets: https://tmsnrt.rs/2zpUAr4

By Tom Westbrook
SINGAPORE, Feb 27 (Reuters) - Oil and Asian share markets
slipped on Thursday, struggling to find a footing as the rapid
global spread of the coronavirus left investors on edge and
seeking safety in gold and bonds.
Most new virus cases are now being reported outside China -
the origin of the outbreak - with South Korea, Italy and Iran
emerging as new epicentres. Brazil reported its first infection overnight and U.S.
health authorities have said a global pandemic is likely.
President Donald Trump, who played down the risks -
comparing the new virus to the flu - appeared to offer little
support to markets focused on news of the pathogen's spread.
U.S. stock futures ESc1 fell as far as 1% as he spoke.
MSCI's broadest index of Asia-Pacific shares outside Japan
.MIAPJ0000PUS traded either side of flat. Australia's S&P/ASX
200 .AXJO was 0.5% lower, for a loss of more than 6% this week
so far. Japan's Nikkei .N225 fell 1.4%. .T
Fresh record-low yields on benchmark 10-year U.S. Treasuries
overnight, though, and the morning's firm gold price underscored
the nervous mood. US/ GOL/
"The market was complacent until last week as central banks
and governments were at the rescue," said Desh Peramunetilleke,
head of microstrategy at Jefferies in Hong Kong.
"The rising infection cases beyond Chinese shores has
certainly raised the pandemic risk," he said. "The current
earnings estimates do not yet factor in such risk and are
therefore vulnerable to further downgrades."
Overnight on Wall Street, the Dow Jones .DJI fell almost
half a percent and the S&P 500 .SPX 0.4% - a slowdown from
consecutive days of 3% drops that have put the indexes
underwater for the year so far. .N

SHRINKING CHINA
The virus has driven an enormous flight of assets out of
Asia as investors try to isolate themselves from both the
outbreak itself and the cost of what has now been more than a
month of paralysis in the world's second-biggest economy.
New Zealand's finance minister said immediate fiscal
stimulus may be needed to stem the damage in his country.
Capital Economics now expects Chinese growth to contract
this year.
"The economic risks from extended disruption are
non-linear," Capital's chief Asia economist and its senior China
economist, Mark Williams and Julian Evans-Pritchard, said in a
note.
"The longer it continues, the more likely it is that some
firms won't be able to pay workers, and will have to either cut
pay, lay people off or shut down altogether."
The latest wave of selling has already driven the
China-sensitive Australian dollar to a new 11-year low and
pushed U.S. oil to a one-year trough, where they mostly sat on
Thursday. FRX/
Last at 1.3271%, the yield on benchmark U.S. 10-year
Treasuries is less than 3 basis points firmer than an all-time
low hit overnight.
U.S. crude CLc1 made a fresh one-year low of $48.17 per
barrel in Asian trade, while gold XAU= rose 0.3% to $1,644.30
per ounce. O/R