(Bloomberg) — Asian stocks were mixed Tuesday as traders evaluated economic growth risks from the omicron virus outbreak and the latest regulatory tightening in China.
Equities rose in Japan but wavered in Hong Kong and China amid sweeping rules from Beijing for overseas share sales — one of China’s biggest steps to tighten scrutiny of international debuts. A Covid outbreak driven by the delta strain in the western city of Xi’an festered, with new cases hitting a record.
The Hang Seng Tech Index slid as much as 1.6% amid holiday-thinned trading, approaching a record-low close from last week.
U.S. and European futures fluctuated following the S&P 500’s 69th close at an all-time high this year. Shorter maturity U.S. Treasury yields rose, while those for longer-dated bonds were steady. The dollar was little changed and oil pushed higher.
Global shares are on course for a third year of double-digit returns, powered by the U.S. surge. The climb has overcome coronavirus waves and a shift by some key central banks toward tighter monetary policy to fight high inflation. Concerns remain that those variables could spur heightened volatility.
“The remedies that we put in place to counter the Covid recessions, they were so substantial, we had massive stimulus,” Sandip Bhagat, chief investment officer of Whittier Trust, said on Bloomberg Television. “We’ll be left with a legacy of those policy responses well into the future” and stocks can continue advancing, he said.
In China, the latest escalation in Beijing’s wider regulatory clampdown on private industry casts more doubt over the prospects for overseas initial public offerings, which had proceeded virtually unchecked for two decades.
Elsewhere, the People’s Bank of China — which on the weekend vowed more economic support — boosted a short-term liquidity injection. China Evergrande Group has two more dollar-bond coupon payments due Tuesday, interest that investors aren’t expecting will be paid after the property giant failed to do so on other debt.
In cryptocurrencies, Bitcoin gave up a recent advance to slide below the $50,000 level.
What to watch this week:
- U.S. initial jobless claims, Thursday
For more market analysis, read our MLIV blog.
Some of the main moves in markets:
Stocks
- S&P 500 futures fell 0.1% as of 1:04 p.m. in Tokyo. The S&P 500 rose 1.4%
- Nasdaq 100 futures dipped 0.1%. The Nasdaq 100 rose 1.6%
- Japan’s Topix index climbed 1%
- South Korea’s Kospi index added 0.2%
- China’s Shanghai Composite index fell 0.2%
- Hong Kong’s Hang Seng index fell 0.1%
- Euro Stoxx 50 futures shed 0.2%
Currencies
- The Bloomberg Dollar Spot Index was steady
- The euro was at $1.1325
- The Japanese yen was at 114.89 per dollar
- The offshore yuan was at 6.3754 per dollar
Bonds
- The yield on 10-year U.S. Treasuries held at about 1.47%
Commodities
- West Texas Intermediate crude rose 0.3% to $75.77 a barrel
- Gold was at $1,809.89 an ounce, down 0.1%
More stories like this are available on bloomberg.com
©2021 Bloomberg L.P.
