Updated with a correction.
The coronavirus that originated in the city of Wuhan at the end of December and quickly circled the globe has left asset managers in China and Hong Kong spending more time at home, awaiting signs that steps taken by Beijing to contain the threat to public health are bearing fruit.
How soon progress on that front emerges will determine whether the hit to China's economy from the outbreak can be confined to the first quarter and then, as many anticipate, mostly offset by rebounding consumption and production later in the year.
On that score, Beijing's latest daily statistics on the health crisis are offering some grist for the mills of bulls.
On Feb. 7, China's National Health Commission said it confirmed 3,143 new coronavirus cases over the previous day, down from 3,694 the day before and 3,887 the day before that. As the week began, that key figure had continued to trend higher, with 3,887 on Feb. 5 up from 3,235 the day before and 2,825 on Feb. 3.
Beijing reported 73 virus-related deaths for the latest day, unchanged from the day before after climbing steadily earlier in the week, bringing the death toll on the mainland since the crisis began to 636. And "new suspected cases," which some analysts say they're focusing on as much as confirmed cases, stood at 4,833, down from 5,328 the day before but well above 3,971 on Feb. 5.
Market veterans called the latest numbers hopeful but cautioned it's too soon to declare victory.
While the smaller number of new cases is "definitely positive," two days do not make a trend, said Aidan Yao, Hong Kong-based senior economist (China), macro research-core investments, with AXA Investment Managers. With millions of Wuhan residents who left the city for the Chinese New Year's holidays just returning now, "we are not really out of the woods," he said.
Even so, many analysts remain hopeful China's government will be able to turn the corner in coming weeks — citing Beijing's muscular steps to address the crisis as well as top leader Xi Jinping's public acknowledgment that flubbing the government's response could lead to social instability.