Asian markets fall as investors take stock of the outbreak
Asian stocks were mostly lower on Wednesday, as investors paused after a two-day rally to assess the world’s response to the coronavirus outbreak.
Stocks in Japan were flat by midday, but markets in China, Hong Kong, South Korea and Australia fell slightly. Futures for American and European markets suggested mixed openings.
Investors had, over the past two days, found solace in signs that the outbreak is peaking in some of the hardest-hit parts of the United States and Europe. On Wednesday China lifted its lockdown on the city of Wuhan, where the virus first emerged, in another sign of progress.
But markets remain fragile. Japan and South Korea this week joined other countries preparing big economic rescue packages. Still, the freeze on economic activity from virus containment efforts could have a negative impact for months and years and require even more economic stimulus actions by world leaders.
Reflecting that skepticism, prices for U.S. Treasury bonds, a traditional investment safe haven, were largely higher in Asia trading on Wednesday. On the positive side, oil prices rose on futures markets, in part on hopes that major producing countries like Russia and Saudi Arabia could put aside their differences.
In Japan, the Nikkei 225 index was flat. In mainland China, the Shanghai Composite index was down 0.3 percent. Hong Kong’s Hang Seng Index was down 1 percent. South Korea’s Kospi was down 0.4 percent.
Wall Street’s rally fizzles.
U.S. stocks ended slightly lower on Tuesday after an early rally faded late in the day.
The S&P 500 fell 0.2 percent at the close of trading. Earlier, stocks had been more than 3 percent higher as investors took heart in continued signs that the coronavirus outbreak may be peaking in a number of hard-hit places.
The decline came as benchmark U.S. crude oil fell 9.4 percent on Tuesday, after having climbed earlier in the day, trimming gains in shares of major oil producers. Oil prices have plunged by more than half since most state governments ordered people to stay home.
Stocks have been on a fairly strong, even if disjointed, run over the past two weeks. Initially fueled by Washington’s $2 trillion effort to counter the economic effect of the pandemic, the rally took on a more hopeful tone on Monday — reflecting glimmers of progress in the fight against the virus’s spread in the United States and Europe.
Through Tuesday, the S&P 500 is up nearly 19 percent from its March 23 low. (It’s still more than 21 percent below its high, reached on Feb. 19.)
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