Asian markets slump as outlook for global recovery looks murkier

Asian stock markets followed Wall Street lower Wednesday after European governments extended anti-coronavirus lockdowns, clouding the outlook for economic recovery.

Japan’s Nikkei 225 NIK, -2.04% fell 1.8% and Hong Kong’s Hang Seng index HSI, -2.03% slid 2%. The Shanghai Composite SHCOMP, -1.30% declined 1.3%. South Korea’s Kospi 180721, -0.28% edged 0.3% lower, while Australia’s S&P/ASX 200 XJO, +0.50% inched 0.4% higher. Stocks fell in Singapore STI, +0.05%, Taiwan Y9999, -0.90% and Indonesia JAKIDX, -1.54%.

Overnight, Wall Street gave up most of the previous day’s gains as technology, industrial and bank stocks fell.

Investor confidence was shaken after Germany, Europe’s biggest economy, and the Netherlands extended lockdowns and imposed new travel and business curbs in response to spikes in infection.

The World Health Organization said the weekly global death toll from the virus is rising again following six weeks of declines. It said the number of new reported cases rose in four of six global regions.

“Investors were left scrambling for life jackets, as it seems we are back navigating the stormy sea of the coronavirus pandemic,” said Stephen Innes of Axi in a report. Read more