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World shares mixed after tech-led sell-off on Wall Street

TOKYO (AP) – World shares were mixed yesterday after heavy selling of technology shares cast a chill over the cheerful start to 2022 on Wall Street.

France’s CAC 40 was up less than 0.1 per cent at 7,324.16 in early trading, while Germany’s DAX added 0.2 per cent to 16,185.77. Britain’s FTSE 100 rose 0.2 per cent to 7,516.63. The future contract for the Dow industrials gained 0.1 per cent while that for the S&P 500 slipped two points.

Added to the hangover from the tech-led retreat were reports of sharply rising coronavirus caseloads in Asia and elsewhere.

Expert opinion is divided among those who think the Omicron variant of COVID-19 that is gaining dominance in many places may set off fewer serious illnesses and those who advise more caution. Any restrictions on business activity will be sure to weigh on the recovery that all nations are counting on to happen soon.

“Global markets seem to be writing off Omicron as an existential threat, with some suggesting that the Omicron variant represents the ‘last hurrah’ for COVID. Let’s hope they are right.

But there may still be a final hit to activity in Asia before we can return to a semblance of normality,” said regional head of research Asia-Pacific at ING Robert Carnell.

People walk past a bank’s electronic board showing the Hong Kong share index. PHOTO: AP

Japan’s benchmark Nikkei 225 inched up 0.1 per cent to finish at 29,332.16. Australia’s S&P/ASX 200 dipped 0.3 per cent to 7,565.80. South Korea’s Kospi dropped 1.2 per cent to 2,953.97. Hong Kong’s Hang Seng shed 1.6 per cent to 22,907.25, while the Shanghai Composite index lost 1.0 per cent to 3,595.18.

Troubled Chinese property developer Evergrande announced late yesterday that it was asking bondholders to accept a delayed payment on one of its bonds.

Evergrande Group will conduct a three-day online vote starting tomorrow for holders of the CNY4.5 billion (USD700 million) bond, according to an announcement made through the Shenzhen Stock Exchange in southern China (See also page 11).

Analysts expect trading in Asia to stay choppy for some time. Reported daily COVID-19 cases are still small, compared to Europe and the United States (US). But the surges are coming quickly, now topping 2,000 daily in Japan.

In Japan, many people are not heeding warnings to take precautions and crowds have been out at levels close to pre-pandemic levels in Tokyo, where booster shots have barely gotten started.

Prime Minister Fumio Kishida has promised to speed them up, starting with medical professionals.

A mix of economic data and corporate quarterly earnings reports this week should give investors some insight into the impact that the pandemic and persistently rising inflation are having on companies and consumers.

The US job market will be a major focus for investors, starting with the Labor Department’s jobs report for December, which will be released tomorrow.

Some sectors of the economy are still struggling, especially with supply chain problems.

Growth in manufacturing slowed in December to an 11-month low, according to The Institute for Supply Management, a trade group of purchasing managers. The organisation will release its December report for the service sector today.

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