Asian shares mixed on China developer, virus concerns
By YURI KAGEYAMA
AP Business Writer
Posted:
Updated:
Ahn Young-joon
A currency trader watches monitors at the foreign exchange dealing room of the KEB Hana Bank headquarters in Seoul, South Korea, Thursday, Sept. 23, 2021. Asian shares were mostly higher on Thursday after the Federal Reserve signaled it may begin easing its extraordinary support measures for the economy later this year.
Richard Drew
Toast co-Founder Jonathan Grimm, left, rings the ceremonial first-trade bell, joined by SVP for Finance Jennifer DiRico and fellow co-Founder Steve Fredette, as their IPO begins trading, on the floor of the New York Stock Exchange, Wednesday, Sept. 22, 2021.
Lee Jin-man
A currency trader walks by the screens showing the foreign exchange rates at a foreign exchange dealing room in Seoul, South Korea, Friday, Sept. 24, 2021. Asian shares were mixed Friday amid concerns over troubled Chinese real estate developer Evergrande and over the pandemic.
Lee Jin-man
A currency trader gestures near the screens showing the Korea Composite Stock Price Index (KOSPI), left, and the foreign exchange rate between U.S. dollar and South Korean won at a foreign exchange dealing room in Seoul, South Korea, Friday, Sept. 24, 2021. Asian shares were mixed Friday amid concerns over troubled Chinese real estate developer Evergrande and over the pandemic.
Lee Jin-man
A currency trader gestures near the screen showing the foreign exchange rate between U.S. dollar and South Korean won at a foreign exchange dealing room in Seoul, South Korea, Friday, Sept. 24, 2021. Asian shares were mixed Friday amid concerns over troubled Chinese real estate developer Evergrande and over the pandemic.
Lee Jin-man
A currency trader walks by the screen showing the Korea Composite Stock Price Index (KOSPI) at a foreign exchange dealing room in Seoul, South Korea, Friday, Sept. 24, 2021. Asian shares were mixed Friday amid concerns over troubled Chinese real estate developer Evergrande and over the pandemic.
Mark Lennihan
FILE - In this Nov. 5, 2020 file photo, a sign for Wall Street is carved in the side of a building, in New York. Stocks are opening higher on Wall Street Thursday, Sept. 23, 2021, clawing back a bit more of the ground they lost at the beginning of the week.
Richard Drew
Trader George Ettinger works on the floor of the New York Stock Exchange, Wednesday, Sept. 22, 2021. Stocks rose broadly on Wall Street Wednesday ahead of an update from the Federal Reserve on how and when it might begin easing its extraordinary support measures for the economy.
Richard Drew
Traders confer on the floor of the New York Stock Exchange, Wednesday, Sept. 22, 2021. Stocks rose broadly on Wall Street Wednesday ahead of an update from the Federal Reserve on how and when it might begin easing its extraordinary support measures for the economy.
Ahn Young-joon
Currency traders work at the foreign exchange dealing room of the KEB Hana Bank headquarters in Seoul, South Korea, Thursday, Sept. 23, 2021. Asian shares were mostly higher on Thursday after the Federal Reserve signaled it may begin easing its extraordinary support measures for the economy later this year.
Richard Drew
Trader Frank O'Connell works on the floor of the New York Stock Exchange, Wednesday, Sept. 22, 2021. Stocks rose broadly on Wall Street Wednesday ahead of an update from the Federal Reserve on how and when it might begin easing its extraordinary support measures for the economy.
Richard Drew
Trader Robert Oswald, right, works on the floor of the New York Stock Exchange, Wednesday, Sept. 22, 2021. Stocks rose broadly on Wall Street Wednesday ahead of an update from the Federal Reserve on how and when it might begin easing its extraordinary support measures for the economy.
Richard Drew
Trader Ashley Lara works on the floor of the New York Stock Exchange, Wednesday, Sept. 22, 2021. Stocks rose broadly on Wall Street Wednesday ahead of an update from the Federal Reserve on how and when it might begin easing its extraordinary support measures for the economy.
Richard Drew
A screen on the floor of the New York Stock Exchange shows the rate decision of the Federal Reserve, Wednesday, Sept. 22, 2021. The Federal Reserve signaled Wednesday that it may start raising its benchmark interest rate sometime next year, earlier than it envisioned three months ago and a sign that it's concerned that high inflation pressures may persist.
Richard Drew
A screen on the floor of the New York Stock Exchange, behind trader Fred Demarco, shows the rate decision of the Federal Reserve, Wednesday, Sept. 22, 2021. The Federal Reserve signaled Wednesday that it may start raising its benchmark interest rate sometime next year, earlier than it envisioned three months ago and a sign that it's concerned that high inflation pressures may persist.
Ahn Young-joon
A currency trader watches monitors at the foreign exchange dealing room of the KEB Hana Bank headquarters in Seoul, South Korea, Thursday, Sept. 23, 2021. Asian shares were mostly higher on Thursday after the Federal Reserve signaled it may begin easing its extraordinary support measures for the economy later this year.
Ahn Young-joon
A currency trader passes by screens showing the Korea Composite Stock Price Index (KOSPI), left, and the exchange rate of South Korean won against the U.S. dollar at the foreign exchange dealing room of the KEB Hana Bank headquarters in Seoul, South Korea, Thursday, Sept. 23, 2021. Asian shares were mostly higher on Thursday after the Federal Reserve signaled it may begin easing its extraordinary support measures for the economy later this year.
Lee Jin-man
A bank employee watches computer monitors at a foreign exchange dealing room in Seoul, South Korea, Friday, Sept. 24, 2021. Asian shares were mixed Friday amid concerns over troubled Chinese real estate developer Evergrande and over the pandemic.
TOKYO (AP) — Asian shares were mixed Friday amid concerns over troubled Chinese real estate developer Evergrande and over the pandemic.
Japan’s benchmark jumped after reopening from Thursday’s national holiday, but shares were little changed in South Korea and China.
On Wall Street, stocks rose broadly for a second day in a row, reversing losses for the week. Investors were pleased to have gotten some clarity from the Federal Reserve a day earlier that it was not on the verge of raising interest rates.
Evergrande Group’s announcement that it was making a payment due Thursday has helped to ease worries over whether it might default on its huge debt obligations.
Japan’s benchmark Nikkei 225 jumped 1.9% in the morning session to 30,200.89. South Korea’s Kospi inched up less than 0.1% to 3,128.57. Australia’s S&P/ASX 200 slipped 0.4% to 7,338.50. Hong Kong’s Hang Seng added 0.2% to 24,559.31, while the Shanghai Composite lost nearly 0.1% to 3,639.88.
Masayuki Tsunashima of Mizuho Bank warned risks remained for markets from the potential troubles at Evergrande. Prolonged coronavirus outbreaks also pose risks, he said.
“So, it cannot be ruled out that optimism remains fragile or, at the very least opportunistic as underlying risks have simply not been addressed, much less put to bed,” he said. “And this is consistent with markets remaining prone to volatility and negative shocks.”
On Wall Street, stocks rose for the second straight day, reversing the sharp pullback at the start of the week. The S&P 500 rose 1.2% to 4,448.98. More than 85% of companies in the benchmark index notched gains.
The Dow gained 1.5% to 34,764.82, while the Nasdaq rose 1% to 15,052.24. The Russell 2000 rose 1.8% to 2,259.04. It’s up 1% for the week.
The rally put the major indexes on pace for weekly gains just four days after a broad sell-off on Monday handed the S&P 500 its biggest skid since May and knocked the Dow more than 600 points lower.
The market’s sharp swings reflect how quickly investor sentiment can change. With the market hovering near all-time highs, traders tend to see waves of selling as buying opportunities.
Traders had been feeling uneasy about how quickly the U.S. Federal Reserve might elect to rein in some of the support measures it’s been giving the markets and economy. Those worries were allayed by Wednesday, when the Federal Reserve signaled it wouldn’t begin considering such a tapering of support before at least November, and indicated it may start raising its benchmark interest rate sometime next year.
“The last few days have just been this recognition that all the things that were being talked about, the market has shrugged them off,” said Michael Antonelli, managing director and market strategist at Baird, noting that the S&P 500 is only about 1.5% below its all-time high set earlier this month.
“The market was just ripe for a sell-off,” on Monday, Antonelli said. “We still have not had a 5% pullback from the highs yet this year.”
The Fed said it will likely begin slowing the pace of monthly bond purchases made throughout the pandemic to help keep borrowing costs low “soon” if the economy keeps improving.
“The reality is that the Fed is going to err on side of not tightening anything on inflation until they absolutely have to,” said Brent Schutte, chief investment strategist, Northwestern Mutual Wealth Management Company.
Still, markets have had a rough September and investors could be in for more choppiness, Schutte said.
“People got so used to a one-way market,” he said. “It’s going to be more of two-way market and investors need to get used that, but I still think the trend is higher.”
In energy trading, benchmark U.S. crude oil fell 27 cents to $73.03 a barrel in electronic trading on the New York Mercantile Exchange. It gained $1.07 to $73.30 a barrel on Thursday.
Brent crude, the international standard, lost 24 cents to $77.01 a barrel.
In currency trading, the U.S. dollar rose to 110.39 Japanese yen from 110.31 yen. The euro cost $1.1744, up from $1.1740.
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AP Business Writers Damian J. Troise and Alex Veiga contributed.
