Hong Kong and Singapore's share prices showed some recovery after news that a new SARS case appeared to be an isolated infection. Earlier in the week both stock markets dropped on worries that the case signaled a new outbreak of Severe Acute Respiratory Syndrome.
Singapore's main share index was trading about 1.5 percent lower Friday than last week's close. Most of the losses came midweek after a medical laboratory researcher was confirmed to have contracted SARS.
The news initially caused fears of a fresh SARS crisis. Earlier this year, as the new disease spread to many Asian countries, travel and tourism in the region plunged.
Hugh Young is a fund manager in Singapore with Aberdeen Asset Management Asia.
"Airlines are the most vulnerable of the businesses," he said. "I think it was expected that on the announcement of the first SARS case, and frankly nobody knew if it was the first or indeed an isolated case. At the same time the market was ripe for a bit of profit taking, it having in common with other regional markets has been exceptionally strong over the past few months."
Hong Kong's stock market was closed for a public holiday Friday. It too saw panic selling on the news of the Singapore SARS case leading to a decline of more than two percent Wednesday.
On Thursday the market managed to shake off its jitters, with the Hang Seng Index recovering 0.5 percent before closing for the long weekend. It finished Thursday at 10,883, 2.5 percent lower than last Friday.
"Most markets continue to be buoyed by demand coming in, we as asset managers see that too, with new funds flow[ing] from Europe and North America," said Hugh Young. "It seems very evident people are seriously looking at Asia particularly as a recovery play. And the fact that valuations in markets look very attractive compared to valuations on Wall Street."
Japanese share prices rose 1.5 percent on Friday after falling 3 percent on Thursday. Traders said the end of a two-day losing streak on Wall Street boosted Tokyo shares. The Nikkei 225 gained 0.5 percent on the week to finish at 10,713 on Friday.
Taiwan also followed Wall Street's lead, making cautious gains on Friday after losses the day before. The Taiex closed 6 points up on from last week's close at 5,645.