Most Asian markets have risen in response to the Wall Street rally, but concerns remain.


Most Asian markets have risen in response to the Wall Street rally, but concerns remain.

Although optimism about the global economy and concerns about the fast-spreading Delta variant continue to generate volatility, bargain-hunters joined their US and European counterparts Wednesday to spark a rebound in most Asian markets following two days of selling.

Surges in infections around the world have forced new lockdowns and containment measures, putting the global recovery at risk. Investor confidence has been shaken in recent weeks by surging infections around the world, which have forced new lockdowns and containment measures while putting the global recovery at risk.

As dealers migrated into safe havens like Treasuries, gold, and the yen, equity markets, which had been trading at record or all-time highs, suffered significant losses.

The highly transmissible Delta strain, which has spread like wildfire across countries, including those with high vaccination rates, has been heavily blamed. The biggest concern is for those who are unable to inoculate their populations in a timely manner.

The World Health Organization’s director-general warned on Wednesday that the pandemic was “a test the world is failing.”

Analysts, on the other hand, indicated that while the short-term view was grim, they were optimistic about the long-term outlook and that market losses were to be expected.

“We had a drop, we had a shock, there is fear of the Delta variant, and there is the other side – which is that someday we will get through Covid, and when we do, we will have a global recovery,” Cumberland Advisors’ David Kotok told Bloomberg Television.

“We’ve been witnessing that tension in the markets for a few days now.”

On Tuesday, all three major Wall Street indexes rose more than 1%, recouping much of the previous day’s steep losses, with OANDA’s Edward Moya predicting that “the theme of recurring fresh record highs will eventually persist after this recent wave of Covid fears eases.”

Asia, on the other hand, failed to keep up. Tokyo, Shanghai, Sydney, Singapore, Wellington, Taipei, and Jakarta all gained ground, while Hong Kong, Seoul, and Manila lost ground.

Oil prices fell as demand fears were fanned by growing infection rates, while news that US inventories unexpectedly increased last week added to the market’s gloom.

This is in addition to news this week that OPEC and other major producers had finally decided to increase output in response to concerns that a supply crisis could arise as a result of the economic recovery and people returning to their everyday routines.

Tokyo’s Nikkei 225 index is up 0.5 percent to 27,523.75 points (break)

Washington Newsday’s Brief News from Hong Kong.


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