China's ferrous derivatives slumped on Monday, with iron ore almost hitting its downside limit early in the session, as panic over the coronavirus outbreak and plunging oil prices gripped financial markets. Denting sentiment further were concerns over iron ore demand as China's Baoshan Iron & Steel Co Ltd, or Baosteel, the listed arm of the country's biggest steel producer Baowu Steel Group, said a fire had hit one of its blast furnaces.

Baosteel, however, sought to allay fears saying the fire incident on Sunday would have limited impact on its molten iron output this year, while Baowu said the facility is expected to resume production on Tuesday. Iron ore on the Dalian Commodity Exchange closed down 2.7% at 640 yuan ($92.13) a tonne, after sinking as much as 5.8% earlier in the session. Futures on the Singapore Exchange slid as much as 4.4% but were down 1.7% in afternoon trade.

"The global spread of the coronavirus is resulting in simultaneous supply and demand shocks. We expect these shocks to materially slow economic activity, particularly in the first half of this year," Moody's Investors Service said in a statement.