Pedestrians wearing face masks walk past a monitor displaying the Nikkei 225 index on February 25 in Tokyo, Japan.

Tomohiro Ohsumi | Getty Images

Asia Pacific markets mostly dropped in Thursday afternoon trade as investors remained cautious over the fast-spreading new coronavirus that has infected more than 81,000 people and killed over 2,700.

Most of the people infected and killed by the disease to-date are from China. However, the number of cases outside the country has surged in recent weeks — especially in places like South Korea, Italy, and Iran. That’s led to global sell-off, including in the U.S. where the S&P 500 wiped out $1.7 trillion in just two sessions.

Japanese stocks led losses among major markets in the region as the Nikkei 225 fell 2.11% while the Topix index was down 2.26%. The Japanese yen, considered a safe-haven asset, traded at 110.25 versus the dollar, strengthening from levels above 111.00 earlier in the week.

In South Korea, the Kospi traded down 0.79% as the Bank of Korea kept its policy rate unchanged. The central bank surprised markets by holding its benchmark interest rate at 1.25% when analysts polled by Reuters were expecting a cut. That was despite a recent spike in the number of infection cases in the country — jumping from around 31 to over 1,000 in a little more than a week.

Aberdeen Standard Investments’ Leong Lin Jing described the Bank of Korea’s interest rate decision as “a little bit curious.”

“Bank of Korea has had a habit of being a little bit behind the curve … when acknowledging that growth is slowing down,” Leong, who is Asian fixed income investment manager at Aberdeen, told CNBC’s “Street Signs” on Thursday.

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On Thursday, South Korea’s Centers for Disease Control and Prevention confirmed 334 more cases, bringing the country’s total to 1,595. South Korea now has the most number of confirmed cases outside China, where the outbreak was first reported.

Coronavirus live updates: South Korea reports surge of 334 more cases, bringing total to 1,595

The South Korean won weakened against the dollar to 1,216.25, from levels near 1,212 before the decision.

Hong Kong’s Hang Seng index also saw declines of 0.66% by the afternoon.

Mainland Chinese stocks, on the other hand, bucked the overall trend regionally as they saw gains. The Shanghai composite rose about 0.6% while the Shenzhen component was up 1.2%. The Shenzhen composite also advanced 1.037%. The moves upward came as the World Health Organization said Wednesday the number of daily new coronavirus cases outside China exceeded those inside the country for the first time.

In Australia, the benchmark S&P/ASX 200 was down 0.58% as shares of major banks in the country sold off.

Overall, the MSCI Asia ex-Japan index traded 0.45% lower.

Trump says virus risk to US ‘very low’

Late Wednesday U.S. time, President Donald Trump announced that Vice President Mike Pence will be in charge of the U.S. response to the deadly outbreak. Trump also said the risk of the disease to the country remained “very low.”

Meanwhile, the U.S. Centers for Disease Control and Prevention on Wednesday confirmed the first potential “community spread” of the coronavirus stateside.

U.S. futures pointed to siginficant declines at the Thursday open on Wall Street: Dow futures fell 349 points and indicated a loss of 370.59 points at Thursday’s open. S&P 500 futures and Nasdaq futures also pointed to declines for the two indexes at the open on Thursday.

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Overnight on Wall Street, the Dow Jones Industrial Average extended its sharp weekly decline as it closed 123.77 points lower at 26,957.59. The S&P 500 fell 0.4% to 3,116.39 while the Nasdaq Composite was up just 0.2% at 8,980.77. Wednesday’s losses brought the Dow’s points losses to more than 2,000.

The moves on Wall Street came as the benchmark 10-year Treasury yield slid to 1.3% — hitting an all-time low. Bond yields fell Wednesday after Bloomberg News cited a Food and Drug Administration official saying the coronavirus was on the cusp of a pandemic. The 10-year Treasury yield was last at 1.3088%.

The U.S. dollar index, which tracks the greenback against a basket of its peers, traded at 98.986, after seeing an earlier high of 99.051. The Australian dollar changed hands at $0.6555 after declining from levels around $0.66 yesterday.

Oil prices fell in the afternoon of Asian trading hours, with international benchmark Brent crude futures down 1.24% to $52.77 per barrel. U.S. crude futures also dropped 1.4% to $48.05 per barrel.