Glove Makers May See Near-Term Gain From Hantavirus Worries — Market Talk

The recent Andes hantavirus outbreak could boost sentiment for Southeast Asia's glove sector in the near term, although a Covid-19-like demand surge is unlikely, Citi analyst Megat Fais says in a note. Hantavirus has a higher mortality rate than Covid-19 but spreads far less easily, as transmission generally requires prolonged close contact, he notes. However, the analyst reckons that sector fundamentals are already improving, supported by recovering demand and supply rationalization. Average selling prices are also rising, mainly due to higher costs. Citi maintains buy ratings on Southeast Asian glove makers under its coverage, including Hartalega, Kossan Rubber Industries, Sri Trang Gloves (Thailand) and Top Glove. (yingxian.wong@wsj.com)