This note looks at the potential market implications of the outbreak in swine flu now causing concern globally. The key points are as follows:

– Swine flu deaths in Mexico and the spread of cases around the world have lead to fears of global flu pandemic.

– Coming at a time when the global economy is already weakened, pandemic fears have already caused nervousness in share markets and more weakness is possible.

– While there is reason for concern, the experience with SARS and bird flu highlight that worst case pandemic fears don’t usually come to pass. The world is also better prepared for a viral pandemic now. The key for investors is to be alert, but not alarmed.

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