How would a global bird flu pandemic affect financial markets? If past history, including the effect of SARS in 2003, is anything to go by, the effect would be significant.

"The risk of bird flu causing a global flu pandemic is not insignificant and the consequences are large," argues Shane Oliver, AMP Capital Investors (Australia) head of investment strategy and chief economist. "As such, it will be necessary for investors to keep a close eye on how bird flu develops."

The economic and financial impact of SARS

SARS had a big negative impact on the countries most affected. "Retail sales fell, workers stayed home and travel dr...