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HomeMarketAsian markets largely rise as investors weigh effects of China protests

Asian markets largely rise as investors weigh effects of China protests

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TOKYO — Asian shares were mostly higher Tuesday as market jitters declined over protests in China set off by growing public anger over COVID-19 restrictions.

Japanese government data released Tuesday showed that the unemployment rate for October was unchanged from September at 2.6%. Separately, data released by another ministry showed a slight increase in the number of available jobs per job-seeker at 1.35. The increase has continued for 10 months.

Hiring was up in anticipation of tourists returning in droves to Japan. Borders that have been basically closed during the coronavirus pandemic have reopened at a time when the declining value of the yen against the U.S. dollar and other currencies make Japan an attractive destination for tourists.

Japan’s Nikkei 225
NIK,
-0.58%
lost 0.6% in early trading. Australia’s S&P/ASX 200
XJO,
+0.07%
inched up nearly 0.1% and South Korea’s Kospi
180721,
+0.43%
added 0.4%. Hong Kong’s Hang Seng
HSI,
+3.58%
added 3.3%, while the Shanghai Composite
SHCOMP,
+1.90%
added 1.7%. Benchmark indexes in Singapore
STI,
+0.85%
and Taiwan
Y9999,
+0.22%
advanced, while stocks declined in Indonesia
JAKIDX,
-0.19%.

Although market sentiment has been weighed down by recent demonstrations in China, some analysts noted calm could return in coming sessions. The world’s second largest economy has been stifled by a “zero COVID” policy which includes lockdowns that continually threaten the global supply chain.

“The absence of any clear escalation in protests could aid to bring some calm to markets,” said Yeap Jun Rong, market strategist at IG.

The unrest has stoked worries on Wall Street that if Chinese leader Xi Jinping cracks down further on dissidents there or expands the lockdowns, it could slow the Chinese economy, which would hurt oil prices and global economic growth, said Sam Stovall, chief investment strategist at CFRA.

“A lot of people are worried about what the fallout will be, and basically are using that as an excuse to take some recent profits,” he said.

More than 90% of the stocks in the S&P 500 closed in the red, with technology companies the biggest weights on the broader market. Apple
AAPL,
-2.63%,
which has seen iPhone production hit hard by lockdowns in China, fell 2.6%.

Several casino operators gained ground as the Chinese gambling haven of Macao tentatively renewed their licenses. Las Vegas Sands
LVS,
+1.11%
rose 1.1% and Wynn Resorts
WYNN,
+4.36%
gained 4.4%.

The fallout from the collapse of crypto exchange FTX continued. Cryptocurrency lender BlockFi is filing for Chapter 11 bankruptcy protection. Cryptocurrency exchange Coinbase Global
COIN,
-4.00%
fell 4% and the price of bitcoin
BTCUSD,
+0.42%
slipped 2.1%.

The S&P 500
SPX,
-1.54%
fell 62.18 points, or 1.5%, to 3,963.94. The Dow
DJIA,
-1.45%
dropped 497.57 points, or 1.4%, to 33,849.46. The tech-heavy Nasdaq
COMP,
-1.58%
lost 176.86 points, or 1.6%, to close at 11,049.50.

Wall Street is coming off of a holiday-shortened week that was relatively light on corporate news and economic data. Investors have a busier week ahead as they continue monitoring the hottest inflation in decades and its impact on consumers, business and monetary policy.

Anxiety remains high over the ability of the Federal Reserve to tame inflation by raising interest rates without going too far and causing a recession. The central bank’s benchmark rate currently stands at 3.75% to 4%, up from close to zero in March. It has warned it may have to ultimately raise rates to previously unanticipated levels to rein in high prices on everything from food to clothing.

Federal Reserve Chair Jerome Powell will speak at the Brookings Institution about the outlook for the U.S. economy and the labor market on Wednesday.

The Conference Board will release its consumer confidence index for November on Tuesday. That could shed more light on how consumers have been holding up amid high prices and how they plan on spending through the holiday shopping season and into 2023.

The government will release several reports about the labor market this week that could give Wall Street more insight into one of the strongest sectors of the economy. A report about job openings and labor turnover for October will be released on Wednesday, followed by a weekly unemployment claims report on Thursday. The closely watched monthly report on the job market will be released on Friday.

In energy trading, benchmark U.S. crude
CLF23,
+0.92%
fell 17 cents to $77.07 a barrel. Brent crude
BRNF23,
+1.26%,
the international standard, lost 5 cents to $83.14 a barrel.

In currency trading, the U.S. dollar
USDJPY,
-0.30%
fell to 138.77 yen from 138.90 yen.

Credit: marketwatch.com

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