The broking arm of Credit Suisse AG is of the view that the short-term impact of the deadly coronavirus in China may be greater than the effect the systematic acute respiratory syndrome, better known as SARS, had in 2003.
Although, commendable from a public health perspective, the stricter quarantines and travel bans issued now will likely hurt consumer and traveller sentiment more than the efforts to counter SARS, the brokerage firm said.
The human-to-human communicable virus, which originated in the Chinese city of Wuhan, has already killed over 130 people in China with the number of people infected now exceeding 6,000 worldwide.
Asian economies recovered quickly from SARS, but the brokerage sees a risk that weakness could persist after the Wuhan virus recedes.
Credit Suisse's pessimism stems from the fact that Asian economies had a greater growth momentum during the time of the SARS outbreak as compared to now, and on the assumption that coronavirus' spread may last longer than SARS.
The brokerage believes that Hong Kong, China, Singapore, and Thailand are the most vulnerable economies at the moment with limited fiscal leg room to counter any stress on economic growth.
Credit Suisse is also of the view that the coronavirus outbreak should not greatly impact global demand for information technology companies and may even be beneficial for electronic commerce companies.
"While we lack confidence in our forecasts for the short term, we feel more comfortable saying that the Wuhan virus will likely prove a one-off crisis, rather than a persistent or annual event," the brokerage said.