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Stock Market Performance During Virus Outbreaks

Over the past few weeks, we have seen the Coronavirus brought up in the news. What started in China has spread into the United States, with five confirmed cases. With each confirmation of the Coronavirus in the United States, we have seen Wall Street go into the red.

With the onset of another infectious disease, many wonder if this will be the one to end the bull market. Markets tend to disagree with this thought. Looking back at other outbreaks, they have had little to no negative impact on equity markets. 

According to MarketWatch, the S&P has moved into positive territory six months after each of the last five outbreaks 1. In the table below 1, we can see that MERS, Ebola, Measles and Zika have not had a lasting impact on the S&P. 

VirusMonth End6 Month % change of S&P 
MERSMay 201310.74
EbolaMarch 20145.34
MeaslesDecember 2014.20
ZikaJanuary 201612.03
MeaslesJune 20199.82

Will the Coronavirus slow equity markets down? Or will it have a similar impact as recent health scares such as Ebola & SARS?

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1 - Information provided in the table was from MarketWatch : https://www.marketwatch.com/story/heres-how-the-stock-market-has-performed-during-past-viral-outbreaks-as-chinas-coronavirus-spreads-2020-01-22