HONG KONG – Asian markets fluctuated in morning trade today as investors weigh record gains on Wall Street against fears that the resurgent Delta Covid-19 variant may put the brakes on global economic recovery.
Major United States indices rebounded overnight from a slow start as bargain hunters stepped up purchases, leaving both the Dow and S&P 500 finishing narrowly positive to extend a streak of record-high closes for a fifth straight day.
Buoyed by those gains on Wall Street, Tokyo opened up 0.5%.
However, Mizuho Securities warned that the market will be “weighed down by rising virus cases and geopolitical risks that are pushing the yen higher”.
Markets in China have dragged since a regulatory crackdown on private business by Beijing left investors on edge, with Hong Kong fluctuating throughout the morning session and Shanghai flat.
Prospects for global recovery are also hit by Chinese data this week showing retail sales and industrial production slowing last month, with a rapid recovery threatened by renewed localised virus lockdowns and extensive travel restrictions.
Raymond Yeung, chief economist for Greater China at ANZ Banking Group, said the figures “suggest the economy is losing steam very fast”.
Surging infections linked to Delta also add “extra risk to August’s activities”, he said.
Markets in Seoul were down, as were Taipei and Australia, where millions remain under coronavirus restrictions with little end in sight as cases tied to Delta soar.
Also hit by the virus gloom have been oil prices, which rebounded slightly from falls of around 1.5% yesterday that were prompted by the weak economic data from Beijing.
“As data begins to reflect the full impact of the shutdown in China, investors are worried this negative trend we’re seeing won’t just be a localised issue,” Bart Melek of TD Securities told Bloomberg TV.
“We are moving from expectations of a robust deficit to a potential surplus as the variant continues to halt the growth rate of demand.”
But, some cause for optimism may come later in the day stateside, where investors will be closely watching US retail sales data for signs that the country’s consumer spending remains healthy. – AFP, August 17, 2021
