Mask producers get a boost, while airline, tourism stocks decline
Chinese stocks related to drugmakers and face masks rallied on Monday following the latest official report concerning the country’s new strain of pneumonia.
Major domestic mask manufacturer Shanghai Dragon Corp, pharmaceutical and biotechnology company Jiangsu Sihuan Bioengineering Co and antibiotics manufacturer Shandong Lukang Pharmaceutical Co all saw their shares hit the daily ceiling of 10 percent on Monday.
In comparison, airlines, tourism and cinema stocks declined. Shares of Wanda Film Holding fell by the daily 10 percent limit.
As of 6pm (Beijing time) on Monday, 224 new cases of the novel pneumonia had been reported domestically, including 217 confirmed cases – 198 in Wuhan, capital of Central China’s Hubei Province, five in Beijing and 14 in South China’s Guangdong Province, according to China’s state broadcaster. There were also seven suspected cases.
A person close to the Shanghai Dragon Corp told the Global Times on Monday that the company previously manufactured medical masks, but that was during the outbreak of SARS, which took place 17 years ago. “We received a [temporary] special order from the Shanghai government to only produce masks during that time, but our current business is textiles – products like underwear,” she said. To manufacture medical masks, producers must first have a corresponding license from the government, she said.
Allmed, a major manufacturer and exporter of medical care products based in Hubei, said Monday that the company has received an increasing number of facial mask orders, and it aims to guarantee supply for the market, especially for hospitals.
China’s Spring Festival holidays are approaching, and this weekend hundreds of millions of people will be carried by public transport systems. Wearing a mask will be a simple and convenient precaution many will take. But the supply of masks will struggle to meet the rising demand.
A salesperson from a health products store on taobao.com told the Global Times that its popular surgical masks have sold out from its warehouse in Wuhan. “Now many consumers are asking about the surgical masks, but we do not have those in stock,” he said.
Given that the warehouse will not resume work until after the holidays, he suggested consumers go to hospitals or drug stores to purchase masks.
The most popular surgical masks, priced at 129 yuan ($18.86) per box of 50 masks, had been removed from the online store’s homepage as of press time.
Due to the tightening mask supply, some online sellers have increased the retail prices of masks. Prices of surgical masks doubled within hours, some Chinese netizens complained. For instance, the price of the disposable N95 particulate respirator made by US multinational 3M skyrocketed from 133 yuan to 299 yuan in a month on taobao.com.
The Wuhan seafood market, which is at the centre of the pneumonia outbreak, has been closed. (Photo: Handout)
