Asian Stocks Down, COVID-19 Delta Variant Outbreak Weighs on Economy

imageStock Markets2 hours ago (Jul 06, 2021 10:27PM ET)

(C) Reuters.

By Doris Yu – Asia Pacific stocks were mostly down Wednesday morning as investors are concerned about the economic outlook and the spread of the COVID-19 delta variant.

The benchmark 10-year U.S. Treasury yields hit February lows after data released on Tuesday said the U.S. Institute of Supply Management (ISM) non-manufacturing purchasing managers index (PMI) in June was 60.1, below the 63.5 figure in forecasts prepared by

Japan’s Nikkei 225 fell 0.9% by 10:09 PM ET (2:09 AM GMT).

South Korea’s KOSPI slid 0.56%. The country reported over 1,200 new COVID-19 cases in the past 24 hours on Wednesday, the highest daily count since late December 2020.

In Australia, the S&P/ASX 200 rose 0.67% after the Reserve Bank of Australia decided on Tuesday to keep interest rates unchanged at the record low level of 0.1%.

Hong Kong’s Hang Seng Index was down 0.73%.

China’s Shanghai Composite was edged down 0.11% while the Shenzhen Component was up 0.29%. China will release its producer price index and consumer price index on Friday.

Investors are also keeping an eye on China’s stricter scrutiny of data security and overseas listings after New York-listed riding-hailing app Didi Chuxing was removed from the app stores.

Despite an almost all-time high level of global stocks, potential risks, including inflationary pressures, reduced central bank stimulus, and the outbreak of the COVID-19 delta variant, weigh on the global market.

Investors now await the minutes from the U.S. Federal Reserve’s June policy meeting, due on Jul. 8, for further clues on the timeline of tapering asset purchases.

“There are still concerns about what happens with the Fed tapering and there’s lack of traction on the fiscal stimulus side… those uncertainties are just injecting some volatility and then you throw in concerns about peak economic growth. That just feeds into the concerns about — is the best growth behind us?” Truist Advisory Services chief market strategist Keith Lerner told Bloomberg.

Across the Atlantic, the U.K. aims to lift all COVID-19 curbs by Jul. 19 but warned that it will reimpose these measures if the number of COVID-19 cases surges.

Elsewhere, the Group of 20, or G20, finance ministers and central bank governors will meet in Venice on Friday.

Asian Stocks Down, COVID-19 Delta Variant Outbreak Weighs on Economy

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