Asia stocks lower after WS gains on recovery hopes

BEIJING: Major Asian stock markets declined Wednesday after Wall Street gained on hopes for a global economic recovery and Japan’s exports sank.

Market benchmarks in Shanghai, Tokyo, Hong Kong and Seoul retreated.

Wall Street’s benchmark S&P 500 index rose for a third day, gaining 1.9% on Tuesday after US retail spending was stronger than expected.

Also Tuesday, the Federal Reserve promised to keep its policy ultraloose to support business activity.

Global stock markets have regained most of this year’s losses as investors look ahead to a rebound from the coronavirus pandemic despite rising infections in the United States, Brazil and some other major countries.

Analysts warn the gains might be too big and too fast to be justified by the uncertain economic outlook.

U.S. retail figures showing an 18% gain over the previous month are encouraging but still $50 billion below what might have been expected without the coronavirus, said Rob Carnell of ING in a report.

“We don’t imagine markets will share this nuanced view.” said Carnell. “They will likely make the most of any good news and continue to be dismissive of any bad news.”

The Shanghai Composite Index lost 0.1 percent to 2,929.62 and the Nikkei 225 in Tokyo retreated 0.6 percent to 22,455.76. The Hang Seng in Hong Kong lost 0.3% to 24,274.01.

In Seoul, the Kospi shed 0.3 percent to 2,131.12 and India’s Sensex opened down 0.4 percent at 33,474.57. Sydney’s S&P-ASX 200 gained 0.4 percent to 5,967.60. New Zealand advanced while Singapore declined.

Adding to the mixed picture,

Japan’s government reported May exports fell 28.3 percent from a year earlier in their biggest decline since the 2008 global crisis.

May might mark the low point for Japanese exporters as their major foreign customers begin to emerge from lockdowns, said Marcel Thieliant of Capital Economics in a report.

Also Wednesday, Singapore reported May exports fell 25 percent from a year earlier.