It is another savage day on Asian stock markets. A year or two ago "savage" was, I was reliably informed by my school-age kids, the new "bad," as in "good" or "cool."
Today, savage is just bad, as in worse. India is site of the heaviest selling, the broad Sensex index down 12.0% in late trade. Trading was halted half an hour into the day, after stocks sank 10%. When they resumed, the selling continued, with banks and auto stocks leading the way.
India smartly held a 14-hour curfew on Sunday. It won't be effective in stemming the spread of the Covid-19 virus, but it trained people to know what they should be doing as a normal course of business. So far, the world's second-most populous country has "only" 415 cases of Covid-19, and 7 deaths, but its leaders are preparing for the worst.
Friday's gains in markets such as Hong Kong were erased yet again by heavy selling on Monday. The Hang Seng lost 4.9% on Monday, Korea's Kospi lost 5.5%, Australia's ASX 200 dropped 5.6% and New Zealand stocks plummeted 7.6%. Singapore's Straits Times plunged 7.3% after the city-state reported its first two deaths due to the Covid-19 virus.
Chinese shares again fared better than the rest, with the CSI 300 down 3.4%. Its 13.8% fall in 2020 is the best showing in Asia so far this year, with the vast majority of Asian markets down double or even triple that amount.
The only market spared the free flow of red ink on Monday is Japan. The broad Topix index closed up 0.7%, while the Nikkei 225 of blue-chip stocks rose a positively sunny 2.0%. Investors derived a glimmer of positive news from Sunday's announcement by the International Olympic Committee.
The IOC said in Athens yesterday that will discuss the possibility of pushing the July 24 start date of the Tokyo Olympics back, or even deferring the Games by a year or more. But it also said cancelling the Games "is not on the agenda." It will finalize these discussions "within the next four weeks."
Personally, I think it makes sense for the International Olympic Committee and the Japan organizers to wait a month before making a final decision. It seems everyone is getting on the IOC's case today for not moving quickly enough. Sometimes we need to pause for thought.
The disease has created an entirely new version of "cancel culture," in which virtually every public event gets shelved or scrapped. But Asian infection rates are now slowing. We are bracing for a second round of infections after citizens returned home ahead of travel bans virtually everywhere globally. So the next couple of weeks will be key. Doesn't it make sense for the IOC to wait a little to see what happens? Why the rush to decide everything yesterday?
I really hope the Games can go ahead in some shape or form this year. I seem to be a lone voice on the shore, raging at the waves to stop their advance. Canada has refused to send a team, while U.S., U.K. and Australian athletics bodies have joined many others in insisting on a delay. The Olympics are probably going to get pushed beyond this year. But I wish they weren't.
We really need something to uplift the collective mood, and I can't think of anything that would bring the world together better than a healthy dose of Olympic spirit. Writing this from Hong Kong, I'd also note that containment efforts appear to have worked pretty well in Asia in general and in Japan, which has 1,102 confirmed virus cases, and 45 deaths. Prime Minister Shinzo Abe has floated the idea of re-opening schools, currently closed across the country.
Japan could suffer a second round of infections, it's true. Maybe its testing is imperfect and not as widespread as it should be. This next two weeks, the incubation time after travel bans went into effect, will tell us a lot.
One thing is for sure: we are going to have to establish some protocols for operating some kind of life under the Covid-19 virus going forward. It won't be normal life, but we need to plan for human activity to resume, possibly with the virus operating in the background.
Any vaccine is likely to be 12 to 18 months away, according to immunologist Anthony Fauci, the top U.S. health official on this fight. While self-isolation and social distancing can work as a stop-gap temporary measure, the economic and social consequences of suspending basically all human activity for a year would be far greater than the direct health costs now being caused by the virus. What kind of alcoholism, obesity and suicide rates are we going to see if everyone loses their jobs and sits alone at home on the couch?
We need to figure out how to hold something like an Olympic Games. Tokyo was actually scheduled to hold the 1940 Olympics, which got cancelled entirely due to World War II. So investors on Monday cheered word that the Japanese capital will be guaranteed the Games at some stage.
Can it happen in 2020? Surely there is a way of, for instance, requiring all athletes to travel to the Games ahead of time, to self-isolate for 14 days for training at home, then for good measure spend another 14 days in quarantine in Japan before their performance? They would have to complete health checks to indicate they are in the clear.
The Games would still have to be held behind closed doors, I would suspect. There were 11,238 Olympians who took part in the 2016 Games in Rio de Janeiro, so marshalling them would be a big enough burden. Add to that the hundreds of officials necessary to score and judge the 28 standard sports, plus five added just for Tokyo: baseball/softball, surfing, skateboarding, sport climbing and karate.
Somehow sponsorship would have to make up for the lost ticket sales, with 7.5 million tickets sold for the Rio event. It's said to take 50,000 volunteers and staff to hold an Olympics, but they must in large part be required to handle crowds.
The issue of athletes training for the events is a complex one. Athletes now are most likely unable to train properly during a lockdown or in isolation, particularly if they compete in team sports. So their efforts to prepare will have been curtailed.
Then again, athletes train to peak at certain times. Delaying that peak by another whole year is also far from ideal. Qualifying events are almost complete if not already complete, raising the question of whether these would need to be held again if we have a delay of a year or more.
The performance of the Tokyo stock market will have this Olympic decision as a wild-card factor influences its performance for the next few weeks -- certainly the month the IOC has given itself to decide. The IOC is under fierce pressure to make up its mind quicker.
Foreign investors, which hold around 30% of Japanese shares, in fact dominate trade in Tokyo. I suspect it is domestic investors who have been bidding up stocks today. There will be short-term fluctuations in their mood depending on official announcements.
As of Monday, there are 123 days to go before the Tokyo Olympics are scheduled to start. Almost exactly four months. Push that date back if necessary -- two months would give us half a year to prepare -- but from this one correspondent, could I beg that we don't push them too far, please?