- TOKYO, AP – Asian shares have dropped in cautious trading following a decline on Wall Street amid continuing worries about the Omicron coronavirus variant, especially rising cases in China.
Japan’s benchmark Nikkei 225 fell 0.8 per cent in Tuesday morning trading to 28,242.46. South Korea’s Kospi was little changed at 2,926.01. Hong Kong’s Hang Seng lost 0.5 per cent to 23,640.42, while the Shanghai Composite inched down less than 0.1 per cent to 3,592.35.
Asian markets also have their eyes on the US Federal Reserve, which is expected to tighten interest rates this year. What happens in China is also likely to have regional repercussions.
Major companies, including carmakers such as Toyota, had been counting on a recovery in the supply of semiconductor chips and other products from China and the rest of Asia, as vaccinations and other coronavirus prevention efforts advance.
The recent surge in infections by Omicron has thrown a spanner into such hopes.
“China continues to grapple with an uptick in COVID-19 cases, with restriction measures kicking in to contain spreads before the Winter Olympics in February. While it may still be too early to say, the risks on watch may be from any disruptions in supply chains aggravating pricing pressures or a shift in China’s zero-COVID approach,” said Yeap Jun Rong, market strategist at IG in Singapore.
On Wall Street, the S&P 500 closed just 0.1 per cent lower, having been down 2 per cent earlier. The Dow Jones Industrial Average fell 0.5 per cent after having been down 1.6 per cent, and the tech-heavy Nasdaq eked out a gain of less than 0.1 per cent after having been down 2.7 per cent.