Asian shares down on virus risk, U.S.-China tension
Asian shares and U.S. stock futures fell on Friday as record-breaking new coronavirus cases in several U.S. states stoked concern about economic recovery, while investors looked forward to earnings season.
MSCI’s broadest index of Asia-Pacific shares outside Japan fell 0.74%. Australian stocks declined by 0.31% as an extension of loan payment deferrals hit the banking sector. Japanese stocks were down by 0.58%.
The Antipodean currencies fell and the yen rose as traders shunned risk and sought safe havens.
More than 60,500 new COVID-19 infections were reported across the United States on Thursday, the largest single-day tally of cases by any country since the virus emerged late last year in China.
That heightened concerns that renewed lockdowns could hurt the economic recovery.
The number of Americans filing for jobless benefits dropped to a near four-month low last week, data showed.
But investors remained cautious as the report also said a record 32.9 million people were collecting unemployment checks in the third week of June, supporting expectations the labor market would take years to recover from the COVID-19 pandemic.
· China stock rally pauses on stake cuts, U.S. sanctions
Mainland China shares on Friday ended lower for the first time since June 29 after the country’s state funds announced stake cuts in companies, a move that comes following a torrid bull run in the stock market, and on signs of renewed Sino-U.S. tensions.
The bull run, encouraged by state media, has been fuelled by signs of an early economic recovery for China from the coronavirus, capital market reforms and accelerating inflows of foreign funds.
At the close, the Shanghai Composite index was down 1.95% at 3,383.32, while the blue-chip CSI300 index was down 1.81%. The start-up board ChiNext Composite index was higher by 0.754%.
Denting sentiment further were reports that the United States imposed sanctions on the highest ranking Chinese official yet targeted over alleged human rights abuses against the Uighur Muslim minority, a move likely to further ratchet up tensions between Washington and Beijing.
· Japanese shares drop as Tokyo's COVID-19 cases hit record for 2nd straight day
Tokyo stocks closed lower Friday as investor sentiment was dented as daily coronavirus cases in Tokyo increased to a new record high for the second straight day.
The 225-issue Nikkei Stock Average lost 238.48 points, or 1.06 percent, from Thursday to close the day at 22,290.81.
The broader Topix index of all First Section issues on the Tokyo Stock Exchange, meanwhile, dropped 22.04 points, or 1.42 percent, to finish at 1,535.20.
Mining, securities house and real estate-oriented issues comprised those that declined the most by the closing bell.
· European markets edge lower as coronavirus concerns persist
European markets retreated slightly on Friday as concerns about spiking coronavirus cases in the U.S. and elsewhere continue to weigh on the broad recovery rally.
The pan-European Stoxx 600 slid 0.3% in early trade, oil and gas stocks dropping 1.1% to lead losses while the technology sector bucked the trend to edge 0.3% higher.
Reference: CNBC, Reuters
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