Asian markets rise, but Shanghai slips as virus fears cloud outlook
TOKYO — Asian shares were mostly higher Monday, but fears of further waves of coronavirus outbreaks were clouding the economic outlook for the region, tempering the rally.
Japan’s benchmark Nikkei 225
NIK,
rose 0.3%. Australia’s S&P/ASX 200
XJO,
gained 0.7% and South Korea’s Kospi
180721,
added 0.4%. Hong Kong’s Hang Seng
HSI,
added 0.8%, while the Shanghai Composite
SHCOMP,
shed 1.3%. Stocks pulled back in Indonesia
JAKIDX,
but advanced in Taiwan
Y9999,
and Singapore
STI,
Japan’s ruling party will hold an election later this week to choose a leader, who is likely to succeed Yoshihide Suga as prime minister after just one year in office. All the candidates are certain to stick to the nation’s pro-U.S. policies, despite some nuances in their views.
They also are all promising to boost government spending to try to catalyze growth in the world’s third largest economy.
Analysts also say Japan’s central bank “tankan” economic survey for the third quarter, due out Friday, likely will show a deterioration in business conditions because of various disruptions to supply chains and renewed outbreaks of COVID-19 in many regions.
Although some parts of the world have lifted COVID-19 restrictions and are gradually returning to “normal” life, worries remain in Asia about further waves of infections because vaccine rollouts have been slower than the West in some nations.
In Singapore, further COVID-19 restrictions kicked off in an attempt to curb the virus’ spread, as daily new cases have topped the city-state’s peak reached in April 2020.
“”Overall, the manufacturing sector may remain resilient as seen from previous phases of restrictions, but the services sector may come under pressure. That said, previous business adjustments and softer tightening compared to past restriction phases may aid to reduce some impact,” said Yeap Jun Rong, market strategist at IG in Singapore.
Wall Street closed out a choppy week of trading with a mixed finish for the major stock indexes, though the S&P 500 managed its first weekly gain in three weeks.
The S&P 500
SPX,
rose 0.1% to 4,455.48 and is now within 1.9% of the all-time high it set Sept. 2. The Dow Jones Industrial Average
DJIA,
added 0.1% to 34,798. The Nasdaq
COMP,
slipped less than 0.1% to 15,047.70, while the Russell 2000 dropped 0.5% to 2,248.07.
U.S. markets have had a rough September and investors could be in for more volatility given various concerns, including COVID-19 and its lingering impact on the economy, along with a slow recovery for the employment market.
Worries over troubled Chinese real…
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