Analysts are worrying over the impact a swine flu outbreak is likely to have on an already shaky world economy.
So far, the deadly flu has not reached the pandemic proportions SARS reached in 2003, but some economic impact can already be seen, and analysts are bracing for more damage.
So far
- oil prices have dropped as fears of the flu spreading are causing people to defer air travel, and consequently lowering petroleum demand.
- Qantas shares dropped 5% yesterday, as investor anxiety increased with the new pressure on the travel industry.
- Biota jumped 77% following news of governments around the world stockpiling the company s antiviral drug Relenza, licensed to GlaxoSmithKline in return for a 7% royalty.
Ongoing concerns
- business in the affected countries will suffer due to foreign tourists staying away, and locals staying home and not spending money.
- the Mexican economy, already in a serious recession, could see the flu outbreak shave 0.6% off GDP this year. The figures would be even worse if the crisis worsens and countries issue travel bans and trading blocks.
For more info
Stocks for your watchlist
- Qantas: QAN.AX (ASX)
- Biota: BTA.AX (ASX)
