According to World Health Organization data, confirmed coronavirus cases in South Korea surged to 602 from 30 over the week ended Feb. 23, making that country the outbreak's second-biggest cluster behind China, where the flu-like epidemic originated in late 2019.
In Monday trading, the Korea Composite Stock Price index tumbled 3.87%.
Most other markets in the region suffered smaller, if still hefty, declines, with drops of 1% to 3% in Malaysia, the Philippines, Australia, India, New Zealand, Hong Kong and Singapore.
China's two main equity markets fared better, with the Shanghai Composite Stock Exchange slipping a mere 0.39% while the Shenzhen exchange rose 1.36%.
Even outside Asia, stock markets reflected fears over the virus, with the FTSE 100 index down 3% at U.K. market open.
Mr. Hui said Shenzhen's gain may reflect the fact that China's onshore market has already priced in some of the negative impact from "the first round of the viral outbreak" and is garnering local support now amid signs that the number of new infection cases on the mainland has started to stabilize.
Still, the strategist said that, with continued uncertainty with regard to how the outbreak will evolve, "we have been advocating a more balanced position between bonds and equities in recent weeks." For the near term, an argument can be made for a 50-50 portfolio "or even a higher proportion in fixed income, considering some of the recent cases in Europe and the Middle East," he said in an email.
Thomas Poullaouec, Hong Kong-based head of multiasset solutions – Asia-Pacific, with T. Rowe Price Hong Kong Ltd., said in an email that it's not surprising that the recent weakness seen on Wall Street is spilling over to Asia "given the recent headlines and poor economic data that will start to be announced."
But Mr. Poullaouec said his team, with a one-year outlook, hasn't changed its positions. While the situation has to be monitored closely, "we remain constructive on risky assets," he said.
Amid the general uncertainty due to the coronavirus, Malaysia supplied its own tidal wave of uncertainty for investors.
On Monday, Mahathir Mohamad, the former prime minister who came out of retirement to lead the country's long-suffering opposition parties to an improbable election victory in May 2018, resigned as prime minister, leaving it unclear whether the former ruling party, the United Malays National Organization, would return to power.