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Asia-Pacific stocks slip as investors watch omicron Covid variant; oil prices rebound more than 4%

SINGAPORE — Shares in Asia-Pacific largely fell in Monday trade as investors continue to monitor developments surrounding the recently discovered omicron Covid variant.

Hong Kong’s Hang Seng index slipped about 0.3%. Hong Kong-listed shares of Chinese tech giant Meituan lost more than 7% after the firm on Friday posted a loss of about 10 billion Chinese yuan ($1.56 billion) for the three months ended Sept. 30.

Shares of Sun Entertainment Group in Hong Kong sank more than 40% after the South China Morning Post reported that controlling shareholder Alvin Chau Cheok-wa was among a group arrested over alleged gambling offences. Shares of Suncity Group, where Chau is CEO, were suspended on Monday “pending the release of an announcement in relation to news coverage” about Chau.

Mainland Chinese stocks were mixed, also paring some losses, with the Shanghai composite down around 0.4% and the Shenzhen component nudging 0.137% higher.

Japanese markets fell in early trade but have since pared some of those losses. The Nikkei 225 declined about 1% earlier but was last trading around 0.2% lower. The Topix index also saw a partial recovery, last dipping 0.59% lower after falling more than 1% earlier. South Korea’s Kospi shed 0.39%.

Shares in Australia also slipped as the S&P/ASX 200 fell 0.17%.

MSCI’s broadest index of Asia-Pacific shares outside Japan traded 0.1% lower.

Elsewhere, U.S. stock futures moved higher following Friday’s big sell-off, as investors stateside also watched for the latest developments related to the omicron variant.

Global markets tumbled late last week as the World Health Organization (WHO) labeled the omicron Covid strain a “variant of concern.” In Asia, the Nikkei 225 in Japan and Hang Seng index in Hong Kong both fell more than 2% on Friday.

“Things definitely will be a little bit more dicey going forward,” John Vail, chief global strategist at Nikko Asset Management, told CNBC’s “Squawk Box Asia” on Monday.

“This variant, as it seems, might not be as horrible as the market thought it might be on Friday, but still it’s got to shake out some of the excess risk taking and perhaps some of the excess consumption out there in the world too as people grow a bit more cautious,” Vail said.

The WHO said in a Sunday statement that it was still unclear whether infection with the omicron Covid variant causes more severe disease as compared with other strains, including delta.

Oil prices were higher in the morning of Asia trading hours, after dropping as much as 13% on Friday, its worst day this year.

International benchmark Brent crude futures were up 4.43% to $75.94 per barrel. U.S. crude futures gained 5.03% to $71.58 per barrel.

Bitcoin prices were also higher, recovering after a Friday plunge. The cryptocurrency was up 5.65% and trading at $57,705.66 as of 9:04 p.m. ET Sunday, according to data from Coin Metrics.

Spot gold traded at $1,793.64 per ounce, having declined from above $1,800 late last week.

The Japanese yen, widely seen as a safe-haven currency, traded at 113.66 per dollar after strengthening sharply late last week from above 114.8 against the greenback.

The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 96.225 after a recent drop from above 96.4.

The Australian dollar changed hands at $0.7143, having dropped last week from above $0.725.

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