The fast-spreading novel coronavirus outbreak has erased $16.7 trillion market capitalization in global stock markets, according to news reports Sunday.

The overall market cap in 86 nations dropped 18.7 percent, from $89. 2 trillion on Jan. 20 to $72.5 trillion on March 12, according to data compiled by Bloomberg.

The market cap loss during the volatile past few weeks is approximately tenfold that of South Korea’s nominal gross domestic product, standing at $1.6 trillion in 2019.

The global stock markets are now on the brink of entering a bearish phase with a nearly 20 percent collapse so far.

Of the nations, 33 saw more than a 20 percent drop -- with Russia, Colombia, Norway and Brazil shedding more than 30 percent.

The Korean stock market, which came in at 28th in terms of decline, lost 22.09 percent during the same period while the US and Japanese markets shed 18.84 percent and 19.71 percent, respectively.

China, on the other hand, experienced a relatively moderate fall of 4.22 percent, although it has borne the brunt of the virus since late last year.

Around 14,500 coronavirus cases have been confirmed worldwide with the death toll reaching 5,388. Among the countries hit hardest by the infectious disease are China, Iran, Italy, Korea and Spain.

Despite the sharp drops, some experts here said it may take some time to determine whether the global stock markets will turn bearish.

"The 20 percent drop is an indicator for a bear market, but things could unfold differently depending on how long the downward trend lasts,” according to Lee Won, an analyst from Bookook Securities.

“Market conditions can change if governments around the world take timely financial measures,” the analyst added.

Reflecting the tumultuous global stock market, foreign investors sold 1.2 trillion won worth of stocks on Korea’s main bourse Kospi on Friday, continuing their sell-off trend for seven consecutive days.

This came after they posted a record one-day sell-off of 1.3 trillion won on March 9. Since the first coronavirus case was confirmed on Jan 20, foreign investors have sold 11.5 trillion won in total. Individual investors, on the other hand, have bought a total of 13.5 trillion won since the first outbreak.

The contagious disease has also dented the fund market here. The combined net values of public offering and private placement funds, excluding private equity funds that entail management involvement in companies, plummeted 16.4 trillion won in seven days from 701.7 trillion won on March 7 to 685.3 trillion won on March 12.

Such a drop in net value is considered unusual as the fund market had continued to see an upward trend despite a couple of hedge fund debacles, including those involving derivatives-linked funds sold by Woori Bank and Hana Bank and hedge funds managed by Lime Asset Management, which cost investors a huge loss since last year.

By Kim Young-won (wone0102@heraldcorp.com)