Yakult shares surge on Danone stake, SARS rumour
Reuters
, 04.07.03, 2:15 AM ET
TOKYO, April 7 (Reuters) - Shares in Yakult Honsha Co Ltd <2267.T> extended gains on Monday on speculation that French food group Danone <DANO.PA>, which has raised its stake in the Japanese drink maker, may seek business ties or an even bigger share.
The shares also got a boost from a rumour that a sweet milk-like drink produced by Yakult has a preventative effect against the deadly Severe Acute Respiratory Syndrome (SARS) virus, traders said.
Shares in Yakult ended trade up 10.27 percent at 1,869 yen, after touching a 9-½ year high of 1,898.
They have risen 18 percent since Danone, a world leader in its core water, dairy and biscuit businesses, said on Thursday that it had increased its stake in Yakult to 19 percent from five, as it seeks growth in external markets.
"The news prompted a buying spree as investors think Danone may seek to increase its stake in Yakult even further or seek some sort of business alliance in overseas business," said Shuichi Shibanuma, senior analyst at Credit Swiss First Boston.
"Yakult is a typical example of Japanese companies that have strong product lineups and high growth potential, but are run poorly, in terms of corporate governance, as it is led by the founder family."
Shibanuma added that any collaboration with a foreign company like Danone would help improve Yakult's profitability and the way the company is run.
A company spokesman said that in Hong Kong, daily sales of its mainstay "Yakult" probiotic drink had spiked to 900,000 bottles a day on March 31, compared with average sales of 300,000 to 400,000.
Traders cited talk that the drink can stave off the SARS virus. "There's no evidence that Yakult can prevent SARS, but a rumour has spread like wildfire throughout Hong Kong and many shops have been out of stock (there)," the spokesman said.
Sales of the drink in Hong Kong represent less than two percent of total sales of the drink, and sales have not been boosted in Japan, he said.
New case of SARS virus found in Britain
<a href=www.news.scotsman.com>JAMES REYNOLDS ENVIRONMENT CORRESPONDENT
A FIFTH suspected case of the deadly SARS virus was reported in the UK last night, as the death toll across the rest of the world rose above 90.
The new case, reported by health officials, concerns a man who returned to the UK from Taiwan on 29 March and was admitted to hospital in the east of England on 5 April.
It is the second probable case of Severe Acute Respiratory Syndrome reported to the Health Protection Agency’s Communicable Disease Surveillance Centre in as many days.
All five cases were reported following an alert issued by the Health Protection Agency and the Department of Health on 14 March.
A joint statement issued by the Department of Health and the Health Protection Agency said of the fifth male case: "He did not have any symptoms on his flight back to England and there is no need for other passengers to be traced.
"Following admission to hospital, he has been treated in isolation as a precautionary measure and his condition is stable."
Three of the other probable cases who were being treated in various London hospitals have all now recovered and have been discharged from hospital.
The fourth case, who was reported on 5 April, is being treated in North Manchester General Hospital and is in a stable condition.
Worldwide, the toll from the fast-spreading flu-like illness rose to 98 deaths yesterday, as two more people died in Hong Kong.
The exact cause of the illness has not yet been identified, but symptoms include fever, aches, a dry cough and shortness of breath.
The Health Department has advised Britons not to travel to Hong Kong, which has seen more than 700 cases and up to 20 deaths, or Guangdong province, which accounts for at least 40 of China’s reported deaths.
The first case was recorded in November and since then more than 1,100 people in the province have fallen ill.
The figures are still rising across the world and the virus has infected 2,416 people in 18 countries, according to the World Health Organisation (WHO).
A team of WHO investigators has been in Guangdong since Thursday trying to find out how SARS spreads and why it kills.
Many of those sick in China are said to be otherwise healthy people in their 20s to 40s.
Eleven laboratories worldwide are trying to find its source and create a diagnostic test.
Antibiotics do not appear to be effective against the bug, although the WHO said infection-control methods were helping to contain its spread.
It was thought that close contact with an infected person was needed for the infectious agent to spread from one person to another.
A Finnish man who died in Beijing yesterday became China’s first foreign fatality from the disease.
Pekka Aro, 53, died at a Beijing hospital, but appeared to have SARS before he arrived in the Chinese capital on 23 March from Thailand, a Chinese official said.
Aro told doctors he believed he caught the disease on the flight from Bangkok, said Guo Jiyong, deputy director general of the Beijing Health Bureau. He said no-one who had contact with Aro in Beijing has shown symptoms.
A second foreigner - a Canadian - is hospitalised in Beijing with the virus, but no details about the patient’s identity or condition, or whether the person was a resident of Beijing, were released.
The quick announcement of Aro’s death was a striking change from the communist government’s earlier reluctance to release information about SARS. Foreign officials and ordinary Chinese have complained about delays.
The head of the WHO added to the criticism last night, saying China should have been more open in the early stages of the disease.
WHO director general Gro Harlem Bruntland said: "China took too long before they felt the need to be helped. We could have saved time by coming in earlier."
SARS: From China's secret to a worldwide alarm
IHT
NYT The New York Times
Monday, April 7, 2003
This article was reported by Elisabeth Rosenthal, Keith Bradsher, Lawrence K. Altman, Clifford Krauss, Donald G. McNeil Jr. and Amy Harmon and written by Denise Grady.
Last November in Foshan, a small industrial city in Guangdong Province in southern China, a businessman became desperately ill with an unusual type of pneumonia. Doctors could not identify the germ that was making him sick. Ominously, although pneumonia is not usually very contagious, the four health workers who treated him also fell gravely ill with the same disease.
Now, scientists say, the Foshan businessman appears to have had the earliest known case of severe acute respiratory syndrome, or SARS, which has since become an international epidemic. As of Saturday, more than 2,600 people in 20 countries were reported to have contracted the disease, and 100 had died. The overwhelming majority of cases were in mainland China, with 1,220, and Hong Kong, with 883.
The cause of the disease is unknown, but scientists suspect it is a new coronavirus, from a family of highly changeable viruses that until now have been known to cause only more minor illnesses in people, like colds and diarrhea.
SARS was brewing in Guangdong Province for months but was not revealed by the Chinese government until February, when Beijing began reporting cases to the World Health Organization. The Foshan businessman's case was disclosed just last week, when Chinese officials finally agreed to open their casebooks and hospitals to international specialists. The businessman recovered, but Chinese officials have not discussed what happened to those who took care of him, nor have they said where or how he might have contracted the disease.
The rest of the world did not know much about SARS until March 15, when the WHO issued an alert calling the disease a "worldwide health threat." Since then, fear of SARS has led many countries and corporations to halt tourism and business travel to China, Hong Kong, Vietnam and Singapore, decisions that are expected to cost the region billions of dollars.
Efforts to control the disease in Hong Kong appeared to be making headway last week, but the progress may have been short-lived, as cases jumped sharply over the weekend. There were 41 new cases reported Monday and 42 reported Sunday, up from 39 on Saturday and 27 on Friday. The new cases included doctors and nurses. Two women, aged 68 and 71, died Sunday, bringing the number of deaths in Hong Kong to 23. Health experts say it is too soon to tell whether SARS will turn into a global wildfire or cool down. But scientists insist that the disease must be treated as an urgent public health threat. What worries epidemiologists is that SARS can spread rapidly through the air, via coughing and sneezing, and its death rate of 3 percent to 4 percent is significant, particularly because healthy people are among those who have died.
People of all ages, from children to the elderly, have caught SARS. The illness typically starts like any other acute respiratory infection: with a fever, chills, headache, malaise and dry cough. Chest X-rays tend to show what doctors call "atypical pneumonia" in a lower lobe of a lung. In the following days, a victim may develop difficulty breathing as the pneumonia spreads to another lobe.
About five to seven days after onset, the symptoms improve in about 80 percent to 90 percent of patients and worsen in the remainder. Many of the sickest patients require intensive care, some to the point of being connected to a respirator.
Why some people improve and others die is not known. So far, it appears that the people most susceptible to severe symptoms are those 40 years or older and those who have had a chronic disease in the past. Aside from regular nursing care and help in breathing, there is no effective treatment, and recovery seems to depend on the strength of a patient's immune system.
SARS may have spread at jet speed with air travelers, but fear of the respiratory disease is traveling even faster, hurting businesses and economies around the globe. The disease's economic consequences are still modest in North America and Europe. But SARS is clearly slowing growth in East Asia, which, at least until the last three weeks, had been one of the few regions in the world with briskly expanding economies.
On Wednesday, Morgan Stanley cited SARS in lowering its forecast for economic growth in Asia, aside from Japan, to 4.5 percent this year, from 5.1 percent. The lower estimate reflected the investment bank's analysis that the disease would prevent about $15 billion in business from being done this year, mainly because of less tourism and lower retail sales.
Andy Xie, a Morgan Stanley economist, cautioned in a report that the actual economic effect could be considerably greater. "We believe this medical crisis is the gravest since the 1998 Asian crisis," he warned, referring to a drop in the value of Thailand's currency that set off a series of devastating financial crises across Southeast Asia.
Airlines and hotel chains have been hurt the most by the SARS outbreak. Even the strongest travel companies, like Cathay Pacific, Hong Kong's main airline, are not immune, and the disease may have been the final blow for some already troubled businesses, like Air Canada, which filed for bankruptcy last Tuesday.
"We anticipated war; we didn't anticipate this," said Vivian Deuschl, a spokeswoman for the Ritz Carlton Hotel Co., a Marriott subsidiary.
The harm is not confined to the travel industry. Business has plunged at stores and restaurants in heavily affected cities like Hong Kong, Singapore and Toronto, as well as in places that are inaccurately perceived as affected, like the Chinatowns in New York and San Francisco.
Hardest-hit have been retailers in Hong Kong. Customers have simply stopped going into the store of Peter Chan, who sells bronze and ceramic Buddhas and horse statues in a store across the street from the 156-year-old Man Mo Temple, where clouds of incense billowed last week as Taoists prayed for an end to the disease.
"I have been working in this field for more than 20 years," Chan said, "and I have never seen such a bad situation before, not even after 9/11." Electronics companies have struggled to stay in touch with their operations in China, which has become one of the world's largest producers of computers and wireless local area networks.
One big worry is that, as hospitals - in Hong Kong in particular - become flooded with SARS patients, the quality of medical care overall will decline. The U.S. State Department said that part of its reason for offering free tickets out for nonessential diplomats and their families was "concerns over our ability to obtain suitable medical care."
Adding up all these disparate effects has proved a guessing game for economists. A few, like Stephen Roach at Morgan Stanley, predict that SARS could make the difference in tipping the world into a recession if the war in Iraq also becomes prolonged.
No one is certain what causes SARS, but a microbe known as a coronavirus is the chief suspect, most likely a new strain that originated in Guangdong Province.
Coronaviruses take their name from their appearance under an electron microscope: a circular, crownlike shape with protruding spikes. Until now, these viruses were thought to produce only minor illnesses in people, like colds, diarrhea and other intestinal disorders. In cats, dogs, chickens, pigs and cattle, coronaviruses distinct from the human ones cause severe and often fatal illnesses.
All coronaviruses have an extraordinary ability to capture stray bits of genetic material from related viruses and weave them into their own genomes, a feat biologists call recombination. Such natural recombination favors the creation of new viruses, and in theory could turn a benign microbe into a biological time bomb.
For a virus already inclined to morph into new identities, there could be no better environment than southern China. The region is known to be one of the world's great incubators of new viruses, particularly influenza. Though coronaviruses are not related to influenza, scientists say coronaviruses could easily take advantage of the same conditions that make southern China the birthplace of new flu strains.
The region is populated by millions of farmers living on small plots of land in close quarters with their pigs, ducks, chickens and other livestock - an ideal setting for microbes to be passed between species and for viruses to swap genetic material.
Gene swapping is not the only way a new coronavirus can emerge. Another possibility is that an earlier version of the virus, one that did not cause severe illness in people, underwent a genetic mutation that made it more virulent. It is also possible that an animal virus "jumped" into humans. Such jumps are known to occur, sometimes with severe consequences.
Coronaviruses became the chief suspect in SARS when scientists used a device called a gene chip, or a microarray, to scan tissue samples from disease victims. The chip is a glass slide containing bits of genetic material from about 1,000 viruses. If the tissue sample contains genetic material from any of those viruses, it will stick to the corresponding bit on the slide.
When tissue samples from SARS victims were scanned, the slides indicated matches with coronaviruses not only from humans, but also from turkeys and cows. That suggests a strain that has never been seen before. In November and December, outbreaks of the mysterious disease cropped up again and again in cities in Guangdong Province, including Zhongshan and Guangzhou. By January, local doctors were investigating what they suspected was a new kind of atypical pneumonia. But the Chinese government said nothing of the panic in Guangdong.
Finally, on Feb. 9, the WHO received its first report about the disease from China. Before the end of the month, cases had popped up in Hong Kong and Hanoi, and in March one infected traveler from Hong Kong caused an outbreak that led to seven deaths among more than 150 suspected and probable cases. By early March, the disease had begun to spread explosively among hospital workers in Hong Kong and Hanoi.
By mid-March, it was clear that a highly contagious disease was poised to begin spreading around the world. Officials at the health organization realized they had to take drastic action, even though that action might have a devastating impact on travel, tourism and commerce in Asia and elsewhere. "Hong Kong is an international airline hub," said Dr. David Heymann, the organization's executive director for communicable diseases. "We had to let other countries know that this was coming. "And we had to let passengers know what the disease was as well, so that if they got it they could tell their doctors and get themselves isolated."
On March 15, WHO took a highly unusual step in issuing the global health alert, describing the new disease and where it had been found.
Last week, after months of international pressure, a team of WHO experts was finally permitted to go to Guangdong. But until the past two weeks, health officials in China not only were unwilling to share their data, but also denied that the four-month-long pneumonia outbreak affecting Guangdong had anything to do with SARS.