Hong Kong: Asian markets fluctuated in early trading on Tuesday. Investors weighed Wall Street’s record gains and concerns that the resurgence of the Delta Coronavirus variant might hinder the global economic recovery.
The major US stock indexes rebounded from a slow start overnight, as bargain-hunting buyers stepped up their buying efforts-the Dow Jones and S&P 500 index closed slightly higher, closing for the fifth consecutive day and hitting a record high.
Boosted by the rise in Wall Street stocks, the Tokyo stock market opened up 0.5%.
However, Mizuho Securities warned that the market will be “dragged by rising virus cases and geopolitical risks pushing up the yen.”
Since Beijing’s regulatory crackdown on private companies has made investors uneasy, the Chinese market has been a drag. Hong Kong has fluctuated in the morning and Shanghai has been flat.
Data from China this week showed that retail sales and industrial production slowed down in July, and the prospects for global recovery were also hit. The rapid recovery was threatened by a new round of local virus blockade and extensive travel restrictions.
Raymond Yeung, chief economist of ANZ Banking Group Greater China, said that these data “show that the economy is losing momentum quickly.”
He added that the surge in infections associated with the Delta variant of the coronavirus “also added additional risks to the August event”.
The market in Seoul has fallen, as has Taipei and Australia, and with the surge in cases related to the Delta variant, millions of people are still under the limits of the coronavirus, with almost no end in sight.
Oil prices were also affected by the virus downturn, which rebounded slightly after falling by about 1.5% on Monday due to weak economic data in 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 the US retail sales data for signs that the country’s consumer spending remains healthy.