Asian shares are higher after the U.S. markets were closed for the Labor Day national holiday
TOKYO — Asian shares rose Tuesday, after European stocks rallied and U.S. markets were closed for the Labor Day national holiday.
Investors are focusing on uncertainties over the coronavirus pandemic and hopes for a vaccine. Attention is now on how Wall Street might pick up after the holiday break, given the decline that came last week after months of surging prices.
Japan’s benchmark Nikkei 225 gained 0.8% to finish at 23,274.13. Australia’s S&P/ASX 200 added 1.1% to 6,007.80. South Korea’s Kospi gained 0.6% to 2,399.39. Hong Kong’s Hang Seng edged up 0.2% to 24,632.42, while the Shanghai Composite gained 0.5% to 3,309.94.
“Traders and investors alike may slowly but surely come around to the idea that last week’s market rout was tech sector-specific, rather than any real change in underlying sentiment,” said Stephen Innes, chief global markets strategist at AxiCorp.
“There was nothing ‘fundamental’ behind last week’s equity sell-off, but it will most certainly take a while to clear all the option-market after-shocks,” he said.
Also Tuesday, the Japanese government reported that the nation’s economy shrank at a record, even worse rate in the April-June quarter than initially estimated. The Cabinet Office reported Japan’s seasonally adjusted real gross domestic product contracted at an annualized rate of 28.1%, worse than the 27.8% figure given last month.
The coronavirus pandemic, which has people staying home, restaurants and stores empty or closing, and travel and tourism nose-diving, has hurt all the world’s economies and many companies. But it has slammed Japan’s export-reliant economy.
Wall Street’s slide on Friday followed a Labor Department report that showed U.S. hiring slowed to 1.4 million last month. That was the fewest jobs added since the economy started bouncing back from the initial shock of the pandemic. The United States has recovered about half the 22 million jobs lost during the crisis.
In Europe, another round of Brexit trade talks is scheduled in London for later in the day. On Monday, the European Union warned the British government that any attempt to renege on commitments made ahead of its departure from the bloc earlier this year could put at risk the hard-won peace in Northern Ireland. Britain left the bloc on Jan. 31, but the two sides are in a transition period that ends at the end of this year and are negotiating their future trade ties.
Riki Ogawa at the Asia & Oceania Treasury Department at Mizuho Bank in Singapore warned that plenty of other uncertainties remained, such as President Donald Trump’s comments about “decoupling” the U.S. economy from China, as the presidential campaign heats up.
The Asian region depends heavily on a healthy Chinese economy, and trade with the U.S., as well as with China.
“We appear to be short on clarity,” said Ogawa.
Benchmark U.S. crude fell 80 cents to $38.97 a barrel in electronic trading on the New York Mercantile Exchange. Brent crude, the international standard, lost 10 cents to $41.91 per barrel.
The dollar slipped to 106.23 Japanese yen from 106.27 yen. The euro inched up to $1.1819 from $1.1817. ———
Yuri Kageyama is on Twitter https://twitter.com/yurikageyama