Asian shares are mixed as investors eyeball surging coronavirus cases in the region
Asian shares were mixed on Monday as investors eyeballed surging coronavirus cases in the region.
U.S. Secretary of State Mike Pompeo’s weekend comments that President Donald Trump plans to take action on a what he sees as a broad array of national security risks presented by software connected to the Chinese Communist Party added to market jitters.
Pompeo’s remarks followed reports that Microsoft is in advanced talks to buy the U.S. operations of TikTok, which is owned by the Chinese company ByteDance and is seen as a source of national security and censorship concerns by the Trump administration.
Japan’s benchmark Nikkei 225 gained 2.2% to finish at 22,195.38. Australia’s S&P/ASX 200 was flat at 5,926.10. South Korea’s Kospi edged 0.2% higher to 2,252.93. Hong Kong’s Hang Seng dropped 0.7% to 24,427.16, while the Shanghai Composite index jumped 1.7% to 3,364.80.
Investors were also watching the Caixin manufacturing Purchasing Manager’s Index, a private survey which showed China’s manufacturing activity grew in July rising to a higher than expected level of 52.8 on a 0-100 scale where 50 marks the break between expansion and contraction.
A “strong rebound in Western economic activity should better the investor mood this week, even though the short-term direction will likely remain blurred by the persistent COVID threat and global trade tensions,” Ipek Ozkardeskaya, a senior analyst at Swissquote Bank, said in a commentary.
On Friday, Wall Street closed outs its fourth straight winning month as Big Tech shares continued to steamroll through the pandemic. The S&P 500 rose 24.90 points, or 0.8%, to 3,271.12 following blowout profit reports from Apple and several other tech titans.
The Dow Jones Industrial Average was down as many as 300 points before finishing the day up 114.67, or 0.4%, at 26,428.32. The Nasdaq composite jumped 157.64, or 1.5%, to 10,745.27 on the strength for tech stocks, which also accelerated in the last hour of trading.
Despite the gains, caution was apparent across markets as the coronavirus pandemic clouds the global economic outlook.
The U.S. economy cratered to its worst quarterly performance on record during the spring, and worries are high that continuing waves of coronavirus infections may halt what had been a budding recovery.
Over the weekend, the Philippines reported its confirmed caseload had surpassed 100,000, and authorities ordered a renewed lockdown for the capital Manila and several other areas. The premier of Australia’s Victoria state, Daniel Andrews, said a “state of disaster” had been imposed in the Australian state, among sweeping new coronavirus-related restrictions to be imposed across Melbourne and the region from Sunday night.
That included an 8 p.m. to 5 a.m. curfew beginning Sunday night. Andrews said the state of disaster proclamation gave police greater power.
Japan’s second revised real gross domestic product data for January-March, released Monday, showed the world’s third largest economy shrank at an annual rate of 2.2%. The annual pace gives what the rate would have been when the pace for the quarter is continued for a year. The contraction for the quarter was minus 0.6%.
Confirmed coronavirus cases have been surging recently across Japan, especially in urban areas like Tokyo and Fukuoka, raising worries people weren’t staying home or social distancing enough. Critics say the government has been sending out conflicting messages, encouraging people to travel and spend with a “GoTo” campaign offering discounts at hotels and resorts while also saying they should avoid unnecessary risks.
Benchmark U.S. crude oil lost 28 cents to $39.99 a barrel in electronic trading on the New York Mercantile Exchange. Brent crude fell 24 cents to $43.28 a barrel.
The U.S. dollar inched up to 105.93 Japanese yen from 105.90 yen on Friday. The euro inched down to $1.1755 from $1.1779.