Asian markets modestly lower after Wall Street’s tumble

Asian markets modestly lower after Wall Street’s tumble

Stocks slide in Tokyo, Hong Kong, Seoul, Sydnet

Asian shares were moderately lower Friday after an overnight rout on Wall Street as investors were spooked by reports of rising coronavirus cases in the U.S.

Fear that a so-called “second wave,” is already coming has punctured bubbling optimism that a quick economic recovery was already underway. That pushed the Dow Jones Industrial Average down almost 7% on Thursday.

However, Wall Street futures pointed to a steady open on Friday, with the contracts for the S&P 500 and Dow industrials up about 0.7%.

Japan’s Nikkei 225 NIK, -0.74% plunged on the open, but only ended down 0.8%.

South Korea’s Kospi 180721, -2.04% lost 2%, Australia’s S&P/ASX 200 XJO, -1.89% skidded 1.9% to 5,847.80. Hong Kong’s Hang Seng HSI, -0.73% shed 1.1%, while the Shanghai Composite SHCOMP, -0.04% shed 1 point to 2,919.74.

India’s Sensex 1, +0.72% declined 1.7% to 32,970.36 and shares also fell in Taiwan and Southeast Asia.

Losses were milder in Asia than in the U.S. partly because markets in the region have not seen massive gains in recent weeks: outbreaks of the virus, travel disruptions and business shutdowns remain apparent and hopes for a quick rebound more modest.

Although daily newly confirmed cases in Japan have fallen to double-digit levels, workers are returning to work and stores are reopening, without a strong U.S. recovery there are scant expectations for an escape from recession, analysts say.

“It appears that worries about ‘second wave’ of infections have hit, with a swell in the number of cases in states like Arizona and Texas giving cause for concern,” said Riki Ogawa at Mizuho Bank’s Asia and Oceania Treasury Department, noting U.S. Treasury Secretary Steven Mnuchin has said the U.S. can’t afford another lockdown.

“Reports of positive cases from the global protest marches are probably also unearthing fears that a ‘second wave’ may squander the costly curve flattening efforts taken earlier,” Ogawa said.

President Donald Trump on Thursday again criticized the central bank, tweeting: “The Federal Reserve is wrong so often. I see the numbers also, and do MUCH better than they do. We will have a very good Third Quarter, a great Fourth Quarter, and one of our best ever years in 2021.”

U.S. stocks on Thursday had their worst day since March, with the Dow Jones Industrial DJIA, -6.89% tumbling 1,861.82 points, or 6.9%, to 25,128.17, the S&P 500 SPX, -5.89% sank 188.04 points, or 5.9%, to finish at 3,002.10, and the Nasdaq Composite COMP, -5.26% closed down about 527.62 points, or 5.3%, at 9,492.73, one day after charting a record above 10,000.

Benchmark U.S. crude oil for July delivery CLN20, 0.55% continued to fall, hitting $35.48 a barrel in electronic trading on the New York Mercantile Exchange. Brent crude oil for August delivery BRNQ20, 0.78% , the global benchmark, fell to $37.40 a barrel.

In currency dealings, the U.S. dollar USDJPY, 0.39% slipped slightly to 107.17 Japanese yen.

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