Asian stocks closed with a rise

Highlights:

• USA
  The Dow Jones ended with a loss of 0.79% or 282 points, to 35,343. The S&P 500 fell by 0.71% or 31.63 points, to 4,448.08. Meanwhile, the Nasdaq slumped by 0.93% or 137.58 points to 14,656.18.
• ASIA
  The Nikkei increased by 0.59% or 161.44 points, to 27,585.91.
  The Kospi added 0.5% or 15.84 points to 3,158.93.
  The Hang Seng climbed by 0.47% or 121.14 points to 25,867.01.
• EUROPE
• The EuroStoxx 50 index was trading with a loss of 0.35%, and the Stoxx 600 dropped by 0.12%.

Wall Street slipped from record highs

Wall Street declined sharply from its peaks on Tuesday after weak retail sales in the United States. It raised fears of the impact of the Delta variant on economic activity. 

The Dow Jones Industrial Average ended with a loss of 0.79% or 282 points, to 35,343. The S&P 500 fell by 0.71% or 31.63 points, to 4,448.08. Meanwhile, the Nasdaq slumped by 0.93% or 137.58 points to 14,656.18.

 

The Fed is not certain how the Delta outbreak will influence recovery

In a virtual town hall Tuesday, Federal Reserve Chairman Jerome Powell said it wasn’t yet clear whether the delta strain of COVID-19 will significantly impact the US economy. 

The day marked a great contrast to the day before when the stock market scored two new records. The S&P 500 achieved a milestone by doubling its valuation compared to its lowest pandemic point in March 2020.

Since the beginning of August, traders seemed to have relied on the good earnings season. 

Experts note that the spread of the delta variant continues to worry and that there are expectations for the meeting of central banks in Jackson Hole later this month.

Ian Shepherdson, an economist for Pantheon Macroeconomics, stated that the Delta variant hit harder in August. So, the consumer spending forecast will lower for the third quarter drastically. 

Consumer spending in the United States accounts for three-quarters of GDP and is the engine of growth for the world’s largest economy.

Industrial production grew more sharply than expected in July, adding +0.9%. 

The stock of the number one retailer Walmart was flat at $150.78 after announcing net earnings per share slightly below expectations. 

DIY chain Home Depot fell by 4.49% to $320, despite better than expected results.

Investors neglected the automotive sector. Ford slipped by 3.05%, and GM lost 4.78%, meanwhile car sales fell in July by 3.9%.

Airlines have been affected by covid-19 restrictions. American Airlines and United Airlines have sunk more than 2%. 

Vaccine makers Moderna advanced by 7.49%, Pfizer lost 3.05%, and Johnson and Johnson increased by 0.92%. 

Japanese shares recovered on Wednesday

The Nikkei increased by 0.59% or 161.44 points, to 27,585.91.

The Topix added 0.44%, 8.34 points, to 1,923.97.

Defensive shares led gains mainly. Meanwhile, many cyclical shares dropped due to worries that increasing Delta infections could hinder economic recovery.

Fujifilm increased by 3.3% to a record high, extending its rally after announcing solid earnings on Friday. Pharmaceutical companies also advanced. Astellas Pharma added 2.1%, and Chugai Pharmaceutical gained 1.1%.

The biggest winner of the session was the Zinc products maker Toho Zinc. The company climbed by 3.86%. It was followed by the manufacturer of colloidal silicas, Nissan Chemical, adding 3.61%. 

The transport company Nippon Yusen brought together the highest volume of operations of the day and slipped by 1.19%.

Many cyclical shares dropped on rising growth concerns as many countries struggled to contain the Delta variant of the Covid-19.

Steelmakers shed 0.9%, while Shippers dropped by 1.4%.

Masayuki Kubota, a chief strategist at Rakuten Securities, stated that concerns are growing about possible global economic slowdown due to the Delta variant.

The trading volume of the session amounted to 2.18 trillion yen.

 

The Kospi rose after nine days of losing streak

For the first time in 9 days, the Seoul stock exchange settled with an advance. The Kospi added 0.5% or 15.84 points to 3,158.93. Meanwhile, the Kosdaq technology index advanced 10.03 points or 0.99%, to 1,021.08.

The purchases of institutional investors supported the index.

The Kospi started today in the red after the fall on Wall Street on Tuesday. However, it rebounded in mid-morning since many participants were optimistically facing the publication of the final Fed meeting. 

Some indicators in China and the US have been below expectations. It fuels the prospect that stimulus policy will remain intact for some time.

The main South Korean stocks closed in the mixed territory today.

Samsung Electronics dropped by 0.4% today. Meanwhile, Sk Hynix, the world’s second-largest memory chip maker, gained 2.46%.

In the biopharmaceutical sector, Samsung Biologics declined by 1.88%, and its competitor Celltrion closed flat.

Naver, a famous South Korean internet operator, climbed by 0.12%. At the same time, Kakao, the owner of the nation’s most popular messaging app, grew by 2.46%.

Hyundai Motor, the largest South Korean carmaker, lost 0.23%.

 

The Hang Seng Index rose by 0.47%

The Hang Seng in Hong Kong climbed by 0.47% or 121.14 points to 25,867.01. Meanwhile, the Hang Seng China Enterprises rose by 1.02%. All the sub-indices closed in the positive territory. The Commerce and Industry added 0.31%, and the finance increased by 0.67%. Meanwhile, real Estate gained 0.43%, and services added 0.80%.

Among Chinese digital leaders, Meituan increased by 2.15%. Tencent added 0.28%, and Xiaomi hiked by 0.41%. 

Alibaba was the exception. The company suffered a 0.12% drop. 

The Hang Seng Internet & Information Technology Index expanded by 0.47% or 71.63 points to 15,350.68.

Among the 58 fundamental stocks of the Hang Seng Index, Xinyi Solar rose by 6.5% to 15.74. Meanwhile, Hang Lung Properties and China Ping An advanced by 4.12% and 2.97%, respectively, ranking second and third.

The day was positive for the state oil companies. Sinopec and Petrochina saw rises of 0.83% and 0.62%, respectively.

The business volume of the session amounted to 134,410 million Hong Kong dollars (17,260 million dollars). 

 

European stock markets slipped

The main European stock markets moved down Wednesday morning. Investors awaited an update from the Federal Reserve on possible plans to reduce US stimulus. 

The EuroStoxx 50 index in the eurozone fell by 0.35%, and the Stoxx 600 dropped by 0.12%.

Sentiment has been tempered in recent days over concerns that rising coronavirus outbreaks would hinder the economic recovery.

In early trading, the FTSE 100 in London fell by 0.3% to 7,160.40. Germany’s DAX lost 0.3% to 15,877.98 and the CAC 40 in Paris shed 0.4% to 6,791.63.

The political situation in Afghanistan and Beijing’s regulatory ambitions for the Chinese technology sector are also fueling caution.