Asian stock markets sink as traders watch Europe virus cases

PTI, Nov 26, 2021, 9:46 AM IST

Image source: Getty images

Beijing: Asian stock markets sank on Friday as traders watched a surge in coronavirus cases in Europe and anti-disease controls that threaten to disrupt trade and travel.

Shanghai, Tokyo, Hong Kong and Sydney declined. US markets were closed on Thursday for a holiday.

Austria imposed a nationwide 10-day lockdown after its daily virus deaths tripled, while Italy imposed curbs on activity by unvaccinated people. The US government advised Americans to avoid Germany and Denmark. Morocco suspended flights from France after its daily new cases spiked above 30,000.

“Traders will be closely monitoring the situation with the new COVID wave across Europe,” said Anderson Alves of ActivTrades in a report. Alves said curbs imposed by China that limit access for shipping crews are “prolonging a crisis” in global trade.

The Shanghai Composite Index lost 0.4 per cent to 3,569.86 and the Nikkei 225 in Tokyo plunged by an unusually wide 2.5 per cent margin to 28,779.03. The Hang Seng in Hong Kong tumbled 1.9 per cent to 24,260.94.

The Kospi in Seoul lost 1 per cent to 2,949.71 and Sydney’s S&P-ASX 200 fell to 7,301.90. New Zealand and Southeast Asian markets also declined.

Wall Street’s benchmark S&P 500 closed up 0.2 per cent on Wednesday. US markets are due to reopen Friday for a shortened trading session.

Investors are more cautious after Federal Reserve officials said in notes from their October meeting released this week they foresaw the possibility of responding to higher inflation by raising rates sooner than previously planned.

Financial markets had been encouraged by strong US corporate earnings and signs the global economy was rebounding from last year’s history-making decline in activity due to the pandemic. Stock prices have been boosted by easy credit and other measures rolled out by the Fed and other central banks.

Investors worry central bankers might feel pressure to withdraw stimulus earlier than planned due to stronger-than-expected inflation. The Fed said earlier it foresaw keeping rates low until late next year.

In energy markets, benchmark US crude fell USD 1.68 to USD 76.71 per barrel in electronic trading on the New York Mercantile Exchange. Brent crude, the price basis for international oils, shed USD 1.29 to USD 79.63 per barrel in London.

The dollar fell to 114.62 yen from Thursday’s 115.36 yen. The euro advanced to USD 1.1224 from USD 1.1221. (AP)