Global shares mixed as virus worries counter recovery hopes

TOKYO (AP) – Global shares were mixed yesterday as market players waffled between hopes for recovery as economies gradually reopen and worries over the havoc wreaked by the pandemic.

France’s CAC 40 lost 0.5 per cent to 4,437.69, while Germany’s DAX was down nearly 0.2 per cent at 11,057.03. Britain’s FTSE 100 slipped nearly 0.1 per cent to 5,998.01. United States (US) shares were set for gains, with the future for the Dow industrials up nearly 1.0 per cent at 24,932.00. S&P 500 futures rose 0.9 per cent to 5,998.01.

Experts raised doubts over a potential vaccine being developed by Massachusetts-based Moderna Inc. that on Tuesday had driven Wall Street’s biggest rally in more than five weeks. Scientists noted that data from early clinical trials of the vaccine were too limited to yield any conclusive results.

“Doubts cast over the Moderna vaccine trial results knock out one leg from under the market rally,” Jasper Lawler of London Capital Group said in a commentary. “Investors are trying to bake in a scenario where economies reopen and a vaccine is available in time to prevent a second wave. But there are still many unknowns.”

Shares were mostly higher in Asia. Japan’s benchmark Nikkei 225 rose 0.8 per cent to finish at 20,595.15 on expectations that a state of emergency still in effect for Tokyo and seven other cities and prefectures may soon end. South Korea’s Kospi gained 0.5 per cent to 1,989.64. and Australia’s S&P/ASX 200 rose 0.2 per cent to 5,573.00. But Hong Kong’s Hang Seng inched up less than 0.1 per cent to 24,399.95. The Shanghai Composite fell 0.5 per cent to 2,883.74.

A currency trader at the foreign exchange dealing room of the KEB Hana Bank headquarters in Seoul, South Korea. PHOTO: AP

India’s Sensex jumped 1.9 per cent and shares were higher in Taiwan but fell in Singapore and Indonesia.

Japan’s state of emergency, which asked people to stay home but was not a lockdown, was recently lifted in the rest of the nation, with social distancing restrictions.

Chief Economist at SMBC Nikko Securities Yoshimasa Maruyama said the lifting of the emergency could come as soon as later this month. But the hardest hit sectors, such as tourism and restaurants, are unlikely to recover for some time, he said.

“It remains unclear whether there will be another surge in coronavirus cases, but if medical care systems can be maintained, a gradual return to normal economic activity can also be expected,” he said.

Strong data for Japanese machinery orders also helped lift spirits.

Overnight, the S&P 500 fell one per cent. Losses in banks, health care stocks and household goods companies accounted for a big portion of the selling in a late-day slide that erased early strength in technology stocks and companies that rely on consumer spending.

Investors are betting that the economy and corporate profits will begin to recover from the coronavirus pandemic as the US and other countries slowly open up again. However, concerns remain that the relaxing of stay-at-home mandates and the reopening of businesses could bring a resurgence in infections and further shutdowns.

Benchmark US crude oil fell 20 cents to USD31.76 a barrel in electronic trading on the New York Mercantile Exchange. It gained 31 cents to USD31.96 on Tuesday. Brent crude oil, the international standard, inched down one cent to USD34.64 a barrel.

Prices have firmed up as oil producing nations cut back on output and as the gradual reopening of the economies around the globe helps spur demand, which crashed earlier this year due to widespread travel and business shutdowns related to the coronavirus. Crude oil started the year at about USD60 a barrel.

The US dollar cost JPY107.79, up slightly from JPY107.71 on Tuesday. The euro rose to USD1.0943 from USD1.0926.