TOKYO -- Shares slid on Monday as investors shunned equities on growing concerns over the scope of a China virus outbreak, with safe-haven assets such as the Japanese yen and Treasury notes in greater demand.
US S&P 500 mini futures shed 1.2 percent in early Asian trade. The Nikkei futures traded in Chicago suggested Japanese shares are on course for a steep 2 percent decline.
Concerns over the spread of the coronavirus in China, and the potential economic impact, continue to generate financial market headlines.
"Media wins -- all you see is headlines about the coronavirus, giving investors a reason to sell the markets," said Takeo Kamai, head of executions services at CLSA in Tokyo.
The ability of the coronavirus to spread is getting stronger and infections could continue to rise, China's National Health Commission said on Sunday, with more than 2,000 people globally infected and 76 in China killed by the disease.
China's Cabinet also announced it will extend the week-long Lunar New Year holiday by three days to Feb. 2 and schools will return from their break later than usual, state broadcaster CCTV said.
Market participants kept a wary eye on developments surrounding the coronavirus, which the World Health Organization (WHO) deemed "an emergency in China," but not, as yet, for the rest of the world on the eve of the Lunar New Year holiday.
Trade in Asia has already slowed for the Lunar New Year and other holidays, with financial markets in China, Hong Kong and Australia closed on Monday.
All three major Wall Street indexes closed sharply lower on Friday, with the S&P 500 seeing its biggest one-day percentage drop in over three months.
The S&P 500 lost 0.90 percent, the Dow Jones Industrial Average fell 0.58 percent and the Nasdaq Composite shed 0.93 percent after the Centers for Disease Control and Prevention confirmed a second case of the virus on US soil.
US Treasury prices advanced on Friday, pushing yields lower for a fourth straight session, with the benchmark 10-year notes dropping to a nearly three-month trough of 1.670 percent.
In the currency market, the concerns about the virus supported the yen, often perceived as a safe haven because of Japan's net creditor status.
The Japanese currency strengthened as much as 0.49 percent to 108.73 yen per dollar, a 2-1/2-week high.