Asia-Pacific Shares Post Steep Losses as Covid Concerns Weigh on Sentiment

The major Asia Pacific stock indexes were mostly lower on Wednesday as worries over a resurgence of COVID-19 cases in some countries cast doubt on the strength of global growth, weighing on the economic outlook and investor sentiment. Investors followed Wall Street’s lead amid a more than 250 point drop in the Dow as reopening stocks declined.

Traders were especially concerned about rising coronavirus cases in India. The COVID-19 situation in the country remains severe, with 259,170 new daily infections registered on Tuesday. This follows a warning from the World Health Organization (WHO) on Friday that global Covid infection rates are approaching their highest level ever.

Cash Market Performance

In the cash market on Wednesday, Japan’s Nikkei settled at 28508.55, down 591.83 or -2.03%. Hong Kong Hang Seng Index finished at 28644.73, down 491.00 or -1.69% and South Korea’s KOSPI Index closed at 3171.66, down 49.04 or -1.52%.

China’s Shanghai Index is at 3473.76, up 0.82 or +0.02% and Australia’s S&P/ASX 200 Index settled at 6997.40, down 20.40 or -0.29%.

Global Airlines Under Pressure on Reopening Concerns

Reopening plays like airlines fell in Wednesday’s trade, with shares of Qantas Airways in Australia dropping 1.7% while Japan Airlines and ANA Holdings in Japan declined 0.14% and 1.45%, respectively. In Hong Kong, shares of China Eastern Airlines fell 2.2% and Cathay Pacific slipped 1.97%.

Australian Shares Drop 1% as Travel Stocks Weigh, Rebound on Stronger Retail Sales

Australian stocks fell a percent on Wednesday, extending losses into a second straight session, as travel stocks dropped after a new COVID-19 case in New Zealand sparked worries of a pause in the trans-Tasman quarantine-free travel.

A new case of the novel coronavirus detected at Auckland airport comes just a day after the country opened a travel bubble with Australia. That pulled down ASX-listed travel stocks.

The Energy Index also fell 2.1%, led by Beach Energy, down 2.8% and Ampol, losing 1.3%. Oil prices dropped from their one-month highs on fears that world’s third-biggest oil importer India may impose new restrictions.

Aussie shares rebounded from their 1% loss late in the session after a report showed Australia’s retail sales rose 1.4% in March from February, according to preliminary data released Wednesday by the country’s Bureau of Statistics. That was higher than expectations in a Reuters poll for a 1% gain.

For a look at all of today’s economic events, check out our economic calendar.