• Bloomberg, Kyodo

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Chinese shares tumbled and the yuan weakened as traders returned from an extended holiday amid the worsening coronavirus outbreak. Support measures from China’s government helped stem losses somewhat in Asia, while U.S. futures rose and Treasuries slipped.

Stocks in Shanghai opened almost 9 percent lower, while local iron ore and copper futures fell by the daily limit. Equities came off their lows in Tokyo, Seoul and Sydney and fluctuated in Hong Kong. Oil and gold saw modest declines, while the yuan fell past the key 7-per-dollar level.

The deadly outbreak showed no signs of slowing, with China’s death toll reaching at least 360.

Monday’s moves came on the back of turmoil last week. Global equities had their worst week since August amid concern that growth will falter as the virus spreads.

The People’s Bank of China cut rates as it injected cash into the financial system Monday, part of a slew of measures to shore up financial markets.

“It’s not time to go back in and buy yet,” Andrew Harmstone, portfolio manager at Morgan Stanley Investment Management, told Bloomberg TV in Singapore. “We have to see more panic selling peak or some resolution of the virus” spreading, he said.

“It’s way too early to dismiss this outbreak as just a brief interruption of constructive markets,” said Erik Nielsen, group chief economist at UniCredit Bank AG in London. “If the outbreak does not dissipate soon, the authorities in both China and elsewhere are likely to extend travel bans, people will stay at home, and the increase in uncertainty will cause consumers to delay consumption and firms to defer investment.”

In Tokyo, the Nikkei 225 average briefly hit a fresh three-month low as investors grew risk-averse on continued fears over the effect of the coronavirus on the global economy.

The Nikkei fell over 400 points at the outset but later pared its losses after the Shanghai market recovered from its initial drop on the first day of trading after the Lunar New Year break. The pessimistic mood prompted buying of safer assets such as the yen.

Elsewhere, the pound dipped as investors reacted to a report that U.K. Prime Minister Boris Johnson could walk away from talks over Britain’s future trade relationship with the European Union. Indian bonds surged after the government refrained from announcing higher debt sales in Saturday’s budget.

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