European shares on Tuesday recovered from their worst day in nearly four months, even as stock markets across Asia remained under pressure with the rising death toll in China from a rapidly spreading virus denting investor confidence.

The composite Stoxx Europe, which tracks the continent’s 600 largest listed companies, rose 0.4 per cent at Tuesday’s open. A day earlier it fell 2.3 per cent, its worst one-day loss since early October, as heightening concerns over the economic impact of the outbreak sparked a global sell-off.

Wall Street’s S&P 500 closed 1.6 per cent lower on Monday, but equity futures were pointing to gains of 0.5 per cent when US markets begin trading on Tuesday.

“The belief that low rates can and will smooth over in the deepest potholes in the road ahead for financial markets is deeply ingrained,” said Kit Juckes, a strategist at Société Générale. “But there will be an economic impact from the virus outbreak, even if we don’t yet know how long it will last and therefore how big the economic hit will be.”

Economists at Goldman Sachs said that concerns over the virus have overshadowed evidence of a recovery in global growth. “Historically, the ‘panic effect’ generated by epidemics has put sizeable pressure on risky assets,” the US bank said in a note to clients.

Asian shares tumbled on Tuesday as they caught up with stocks elsewhere. Markets had been mostly offline on Monday for a regional holiday. Shares in South Korea, Singapore and Australia all fell.

The weakness across many of the region’s markets came as Chinese state media confirmed the death toll from the pathogen had risen to more than 100. Most of the dead were in Wuhan and the surrounding province of Hubei, the outbreak’s epicentre.

Seoul’s benchmark Kospi index closed 3.1 per cent lower, with stocks that are exposed to a probable fall in spending by Chinese tourists as a result of the virus among the hardest hit. AmorePacific, South Korea’s largest cosmetics company, dropped 8.5 per cent while duty-free chain Hotel Shilla tumbled almost 10 per cent. Smartphone and chipmaker Samsung fell more than 3 per cent.

Singapore’s FTSE Straits Times dropped 1.9 per cent over fears the disease could hit the south-east Asian state’s economy, which is closely linked to China’s.

Hong Kong’s stock exchange will reopen on Wednesday while markets in mainland China do not return from the lunar new year holiday until next Monday. Shanghai has ordered companies not to reopen until February 9.

But in a statement published on Tuesday, China’s securities regulator instructed securities and futures traders to “actively guide investors to rationally, objectively analyse the impact of the outbreak and adhere to the concepts of long-term and value investment”.

In Sydney the S&P/ASX 200 index slipped 1.8 per cent as energy and mining stocks sold off on concerns over the pathogen’s impact on Chinese demand. Commodities-focused companies fell in Tokyo, too, where the Topix shed 0.6 per cent.

Gold, US Treasuries and the Japanese yen — investors’ go-to havens — all slipped slightly. Brent, the international oil marker, fell 0.2 per cent to $59.20 a barrel.

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