Asian stocks rise as traders eye Wall Street losses

HONG KONG (AFP) – Asian markets broadly rose on Wednesday as wary investors tracked losses on Wall Street and elsewhere as a surge of the coronavirus Delta variant stoked fears the global economic recovery was at risk.

A fresh lockdown in New Zealand and a curfew imposed in Australia’s second-largest city of Melbourne over a Delta outbreak have added to concerns about lockdowns and travel restrictions in China, the world’s second-largest economy.

A lacklustre US retail sales report also exacerbated worries about the latest Covid-19 wave, bringing Wall Street’s streak of five straight records for the Dow and S&P 500 indices to a stuttering halt.

Tracking those losses, markets opened flat before rising Wednesday in Tokyo, where the grim global picture was made worse by the government’s decision to extend a state of emergency in the Japanese capital and other areas as the nation struggled to control a surging wave of infections.

“Investors continue to believe that economic normalisation will be delayed because of the spread of the coronavirus,” Okasan Online Securities said in a note.

In China, markets opened well up, recouping some losses after disappointing economic data from Beijing earlier in the week.

Hong Kong also opened with gains, with investors appearing broadly unfazed by new antitrust plans from Beijing designed to reign in China’s burgeoning tech giants — plans that saw Chinese firms listed on Wall Street slide overnight.

Seoul rose, while Australia was steady and Taipei was well down.

New Zealand also made gains, as investors watched a decision by the country’s Reserve Bank to keep interest rates unchanged, deciding against a move that would have seen it become the first advanced economy in the Asia Pacific to normalise policy.

Global markets will be keeping a close eye on the latest minutes out of the US Federal Reserve due later in the day, after chief Jerome Powell acknowledged that the pandemic was “still casting a shadow on economic activity”.

Investors will be looking for any signs that the Fed plans to scale down its asset purchases — a sign that the central bank sees the US economy as now healthy enough to ease its aggressive intervention.

Elsewhere, oil prices steadied after a four-day slump prompted by the increasingly grim outlook for global demand as the Delta variant surges.

The “market still appears to be unsure how the outlook is looking amid rising cases of the Delta variant,” Daniel Hynes, senior commodities strategist at Australia & New Zealand Banking Group Ltd, told Bloomberg. Continued lockdowns could still pile pressure on prices, he added.