KUALA LUMPUR: Healthcare stocks gained today on news of a potential Human Metapneumovirus (HPMV) outbreak in China, even as an analyst said it is unlikely to benefit Malaysian glovemakers.
MIDF Research has a "Neutral" call on the local glove sector citing China's Union health ministry's comments that the outbreak is an annual occurrence during winter and that it is safe to travel to China.
HPMV was reportedly discovered in 2001 with symptoms like that of the common cold, including cough, fever, stuffy or runny nose, sore throat, wheezing, shortness of breath and rashes.
"Premised on this, we view that the seasonal influenza cases would not lead to a surge in glove demand inside and outside of China," it said in its note.
The Bursa Malaysia healthcare index, which is made up of glove, hospital and healthcare product stocks, was up 1.39 per cent even as most other indices were down.
Adventa Bhd was up almost 5 per cent on the news, while Careplus Group Bhd and Top Glove Corp Bhd were both above 3 per cent at midday break.
"Given that the recent rise in HMPV is not outbreak, we view that it should not lead to a surge in demand for gloves both in China and globally."
"Nonetheless, should it lead to an increase in demand in China, we do not think that the Malaysian glove manufacturers would benefit from it."
" China's glove players should have ample capacity to cater for the surge, if any, as its export of gloves to the U.S. would be severely impacted from 2025 onwards following the heightened tariff imposition by the latter," MIDF Research said.
The U.S. raised its tariff against China-made medical gloves from 7.5 per cent in 2024 to 50 per cent in 2025 and 100 per cent in 2026, making China's gloves uncompetitive as compared to its global peers.
"That said, should HPMV or other virus lead to a pandemic, we believe that the supply demand dynamics would turn favourably towards our local glove players," MIDF Research said.