Asian shares retreated yesterday, except in Japan, where the benchmark Nikkei 225 index rallied after a landslide parliamentary election victory by the ruling Liberal Democratic Party.
Concerns about global inflation and interruptions to economic activity brought on by the COVID-19 pandemic are adversely affecting investor sentiment in many parts of the region.
However, the tide may be shifting as more and more market players focus on the economic outlook, SPI Asset Management managing partner Stephen Innes said in a commentary.
Photo: EPA-EFE
“A recession is not the market’s base outlook, but until proven otherwise, investors will debate the depth of the growth hit, not the likelihood of recession; thus, good economic data is good news for stocks,” he said.
The Nikkei 225 jumped 1.1 percent to 26,812.30.
Japan’s governing party and its coalition partner scored a major victory in balloting on Sunday, which came two days after the assassination of former Japanese prime minister Shinzo Abe.
The Liberal Democratic Party was bound for victory even before the assassination, but some analysts said the shock of Abe’s death was likely to strengthen that trend.
With its partner Komeito party, the ruling coalition raised its combined share in the 248-seat upper house to 146. Japanese Prime Minister Fumio Kishida almost certainly stands to rule without interruption until a scheduled election in 2025, ensuring that the pro-US defense and diplomatic policies of the late Abe and the Liberal Democrats would continue unchanged.
Australia’s S&P/ASX 200 declined 1.1 percent to 6,602.20. South Korea’s KOSPI lost 0.4 percent to 2,340.27.
Hong Kong’s Hang Seng slipped 3 percent to 21,067.38, while the Shanghai Composite fell 1.2 percent to 3,314.60.
Technology shares fell after market regulators in China fined companies for not reporting past transactions as required.
E-commerce giant Alibaba Group Holding Ltd (阿里巴巴) tumbled 6.8 percent, while Tencent Holdings Ltd (騰訊) lost 3.2 percent.
On Sunday, China’s State Administration for Market Regulation published a list of 28 deals that violated anti-monopoly rules.
It included five of Alibaba’s transactions and 12 of Tencent’s. For violations in each case, the maximum fine was 500,000 yuan (US$74,541).
Alibaba’s shares had risen 70 percent and Tencent’s were up 18 percent since the middle of March, before yesterday’s losses.
“The dip is likely to be temporary. The market was more wary about the US raising interest rates so sharply, but it’s just been overrun by the new fines,’’ said Francis Lun (藺常念), an investment manager and veteran market commentator in Hong Kong.
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