Here’s how the stock market has performed during past viral outbreaks, as epidemic locks down 3 Chinese cities

U.S. equity markets have experienced muted trade in the past few sessions as investors keep one eye trained on a deadly flu outbreak in China, which could be declared a public health emergency by the World Health Organization within the next 24 hours. 

However, gauged by the market’s performance during the onset of other infectious diseases, including SARS, or severe acute respiratory syndrome, Ebola and avian flu, Wall Street investors may have little to fear that this disease will sicken a U.S. stock market that finished 2019 with the best annual return in years and has kicked off 2020 at or near all-time highs.

That said, many investors are recommending caution amid the current bout of coronavirus that was first identified late last year in Wuhan City, China, and has claimed 17 lives, with more than 500 people sickened, according to some reports. The ability of the virus to halt travel and harm consumption, particularly in Beijing, are some of the ways an outbreak could have economic implications that could wash up on U.S. shores. 

“Epidemics and pandemics do have market consequences and raise risk, and…they can be deadly,” wrote David Kotok, chairman and CIO at money manager Cumberland Advisors, in a Wednesday research note. 

“External shocks can derail economic trends and abruptly alter market sentiment. Not all risk is economic policy or monetary,” he wrote. 

On Thursday, the Dow Jones Industrial Average was set to head lower, while the S&P 500 index and the Nasdaq Composite Index were on track for subdued trading following slight declines on Wednesday. 

Investors lately have been attuned to updates on the spread of the disease, with the first U.S. case reported Tuesday in Seattle, Wash., which dragged major U.S. equity indexes from mostly positive intraday gains midday to modest declines at Tuesday’s close. 

Despite the recent malaise suffered by stocks, indexes have been only slightly lower for the week.

And the degree by which markets have been mostly immune to the coronavirus is something that hews to Wall Street’s historical reaction to such outbreaks and quickly spreading diseases. 

According to Dow Jones Market Data, the S&P 500 posted a gain of 14.59% after the first occurrence of SARS back in 2002-03, based on the end of month performance for the index in April, 2003. About 12 months after that point, the broad-market benchmark was up 20.76% (see attached table):

SARS resulted in a total of about 8,100 people being sickened during the 2003 outbreak, with 774 people dying, according to data from WHO and the Centers for Disease Control and Prevention. 

Separately, the S&P 500 rose 11.66% in the roughly six months following reports of the 2006 Avian flu virus — a fast-moving pathogen also known as H5N1. The market gained 18.36% in the following 12-month period.

Data are similar for equity performance across the globe based on data from Charles Schwab, tracking the MSCI All Countries World Index. The index has gained an average 0.4% in the month after an epidemic, 3.1% in the ensuing six-month period and 8.5% a year later (see graphic below):

The severity of the virus, ultimately, will dictate the market’s reaction and just because indexes have managed to shrug off the contagion from outbreaks in the past doesn’t mean that will be the case this time. 

For one, Coronavirus comes during the important Lunar New Year, when Asia tends to see peak travel and consumer spending. 

“There are concerns that the coronavirus may spread quickly within and beyond China, causing economic and market damage. This is particularly a concern as travel ahead of the Lunar New Year is getting underway,” wrote Jeffrey Kleintop, Charles Schwab’s chief global investment strategist. 

On top of that, markets may be vulnerable to swoons after busting to records.

“In a stock market where the dominant factor is price momentum, the impact of a change occurring in an external risk vector or a natural risk phenomenon is intensified,” wrote Kotok.

Beijing locked down additional cities in an effort to contain the spread of the disease. Chinese officials have so far locked down Huanggang, a city of 7.5 million people,while a smaller city Ezhou, with population of million, said it also would restrict travel, the Wall Street Journal reported. The lock downs follow reports earlier that officials in Wuhan, a city of 11 million people, had instituted travel restrictions. 

Meanwhile, WHO said its emergency committee on Wednesday was split as to whether to declare the new coronavirus a public health emergency of international concern and will meet again on Thursday “given the rapidly evolving situation.”

A pandemic couldn’t come at a worse time for China’s sluggish economy, which slowed to 6.1% rate of annual growth last year, according to gross domestic product figures released last Friday, which reflected the lowest reading for Beijing in nearly three decades.

“The upcoming Lunar New Year celebration…could accelerate the virus’s spread as well as its economic impact,” wrote analysts at Wells Fargo Securities, led by Jay Bryson, in a Wednesday report. 

And travel related stocks have taken a hit this week thus far.

Shares of Priceline.com parent Booking Holdings Inc. are down 2.6% so far this week. Expedia Group Inc. shares have lost 1.6% and TripAdvisor Inc. shares have declined 2.2% over the period. 

Airline stocks are also mostly lower, with United Airlines Holdings Inc. off 7.1%, as of Wednesday’s close, those for Delta Air Lines Inc. are off 3.9% and American Airlines Group Inc. has lost 3.8% over the same period.

Read: This how far and fast the coronavirus has spread through U.S. stocks 

However, any impact is likely to be short-lived for Asia and the rest of the world if the viral spread is limited. 

“If we use the SARS epidemic as a guide, however, any economic impact from the current coronavirus is likely to be temporary,” the Wells analysts said. 

Still, experts emphasize that it is important not to generalize the potential for unexpected results from epidemics on economies and markets. 

“We cannot draw any fixed conclusions about the effects of pandemics upon stock-market performance. Equity markets react unpredictably to the unknown; nevertheless, such events should not be examined in isolation, but viewed in common with other prevailing market conditions,” according to a 2006 report commissioned by Fidelity Investments and cited by Bloomberg News.

This article originally appeared on MarketWatch.