Asian shares grind lower as bears take a breather to reconfirm the covid variant fears during early Monday. The need for checking arises as policymakers from the US, Israel and Australia sound hopeful of overcoming the virus variant that roiled global market sentiment the previous day. Adding to the bullish bias could be the recovery in the US Treasury yields, backed by hawkish comments from Atlanta Federal Reserve President Raphael Bostic.
That said, MSCI’s index of Asian Pacific shares outside Japan drops 0.14% whereas Japan’s Nikkei 225 prints a 0.50% intraday loss, recovering of late, ahead of Monday’s European session.
It’s worth noting that the Asia-Pacific markets witnessed the heaviest daily fall in over three months on Friday amid chatters over the heavy mutation capability of the covid’s South African version. The same backed the World Health Organization’s (WHO) announcement to mark it as a “variant of concern” while also pushing the UK government to call for the special Group of Seven (G7) meeting.
On the contrary, zero cases of the virus strain in the US pushed the National Institutes of Health (NIH) officials to renew hopes that the virus vaccines, as well as the booster doses, can help overcome the latest challenge to the global economy. On the same lines were comments from Australia Health Minister Greg Hunt who said, “We are vastly, vastly better prepared than the overwhelming majority of the world, and I say that with great respect to the immense work that’s been done globally.” Furthermore, Reserve Bank of New Zealand’s (RBNZ) Chief Economist Yuong Ha said in a Wall Street Journal (WSJ) interview on Monday, the new Omicron covid strain is unlikely to alter the central bank’s rate hike plans.
Against this backdrop, markets in Australia and New Zealand remain directionless while those from China fail to cheer dovish comments from the People’s Bank of China (PBOC).
Indonesia’s IDX print mild gains whereas South Korea’s KOSPI and India’s BSE Sensex lick Friday’s wounds with minimal losses.
It’s worth noting that Japan and China recently announced the rejection of flights from South Africa and connected nations.
Moving on, German inflation numbers will join US housing data to decorate Monday’s calendar ahead of speech from US President Joe Biden and Fed Chair Jerome Powell. Also in the spotlight were comments from the Bank of Canada (BOC) and the European Central Bank (ECB) policymakers’’ scheduled speeches.
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