Asian Stocks Drop for the Second Day in a Row

Highlights

• USA
  The S&P 500 and the Nasdaq registered new records. The Dow Jones closed in the red;
• ASIA
  Nikkei settled with a slump of 0.81% to 28,812.61 amid rising worries about a new coronavirus variant;
  Kospi fell by 0.46% or 15.21 points to 3,286.68;
  Chinese stocks settled in negative territory amid worries regarding economic recovery.
• EUROPE
  European shares received a boost, with STOXX 600 trading with a gain of 0.5%.

New Records in the S&P 500 and Nasdaq

Wall Street stock market closed mixed on Monday. Dow Jones closed in the red. However, the S&P 500 and the Nasdaq registered new records supported by the technology sector. 

The selective S&P 500 rose by 0.23% or 9.91 points, to 4,290.61, posting gains for the third consecutive day. The Nasdaq Composite Index advanced by 0.98% or 140.12 points, to 14,500, 51. Meanwhile, the Dow Jones of Industrials slipped by 0.44% or 150.57 points, to 34,283.27.

Graphics-chip specialist Nvidia NVDA led the gains on Nasdaq, surging by 5%. 

By sectors, technology and communications sectors led the gains. Important companies such as Facebook climbed by a remarkable 4.18%.

Facebook hits a trillion-dollar market capitalization

Today, Facebook achieved a market capitalization of a trillion dollars. The company joined a select club made up of Apple, Microsoft, Amazon, and Alphabet. Amazon added more than 1% today, while Alphabet barely changed.

The New York stock market expanded the gains of last week when optimism for the economic recovery in the United States predominated the market.

According to experts, this Monday, the market has been influenced by recent developments in the legislative field of the infrastructure plan proposed by President Joe Biden.

On the other hand, expectations are set in the June employment report released this Friday, which is forecast to create 683,000 jobs.

Among the 30 listed on the Dow Jones, Boeing sank by 3.39%.

Chevron dropped by 3.08%, and American Express yielded 2.76%. On the other hand, the energy sector lost 3.33%, and the financial sector decreased by 0.81%.

Bond yields rose sharply in March amid fears of an inflation surge that have slipped back to their pre-spike level amid a flattening US yield curve.

According to Chris Larkin from E-Trade, inflation fears calmed for the moment, and the market seems to be in a good place.

Nikkei losses 0.81% amid virus worries

The Tokyo Stock exchange settled today with a slump of 0.81% to 28,812.61. Meanwhile, the broader Topix lost 0.82% to 1,949.48. A new coronavirus variant raised worries about disrupting global economic recovery due to its possible impact on the Tokyo Olympic Games, scheduled for less than a month from now. During the session, the weaker cyclical stocks outweighed gains in the technology companies.

Soichiro Matsumoto, a chief investment officer for Japan at Credit Suisse Private Banking, stated that investors sold Japanese cyclical shares after dropping the Dow and European shares. Japan does not have stocks equivalent to big tech shares, and the market did not react to Nasdaq’s strong finish. 

The securities with the highest capitalization, such as the technology giant Softbank, lost 2.14%, and the Japanese automobile leader, Toyota Motor, yielded 1.03%.

The textile multinational Fast Retailing, an owner of the clothing store chain Uniqlo, dropped by 1.20%.

The technological Sony stood out with a gain of 1.19%, and the video game company Nintendo advanced by 0.17%.

In the first section, 1,629 values ​​declined compared to the 422 that advanced. Besides, 423 shares ended unchanged.

The sectors with the most significant declines were mining, steel, metal, glass, and ceramics.

The trading volume amounted to 1.03 trillion yen.

South Korean Kospi slips by 0.46%

Kospi fell by 0.46% due to fears about the spike in infections and the new variants of Covid-19. The Kospi declined by 15.21 points to 3,286.68. 

The Kosdaq technology stock index climbed by 0.45% or 4.61 points to 1,022.52.

The financial, technology, and steel sectors led to losses.

The technological Samsung Electronics dropped by 1.1%. Meanwhile, SK Hynix lost 0.79%.

South Korea’s top internet provider Naver fell by 0.86%. At the same time, pharmaceutical giant Samsung Biologics advanced by 0.36%.

The steel group Posco lost 1.98%, and the financial group KB also yielded 1.92%.

The South Korean auto giant, Hyundai Motor, declined by 0.62%. However, chemical firm LG Chem posted a 1.08% increase.

The local currency, the won, advanced 1.8 points against the US dollar, trading at 1,128.5 won at the session’s close.

Due to the concern about a global expansion of new virus variants, investors moved cautiously in the market for the second day. Sang-young, Mirae Asset Securities analyst, stated that the growing Delta variant cases and restrictions on travel are prompting investors to be risk-averse. It has resulted in a fall in stock prices in the overall Asian markets.

Chinese stocks ended in the red

The Delta variant of the new Covid-19, first identified in India, is becoming globally dominant across various nations, and China is no exception. 

According to officials, the Delta variant has caused infections in southern Guangdong province, where the number of confirmed cases totaled 170 between May 21 and June 21.

China’s central bank stated that the country’s economy was showing more stability. However, domestic and international environments remained gloomy. 

Shanghai composite index dropped by 0.92% or 33.19 points to 3,573.18. Kweichow Moutai, a liquor distiller, declined by 2% to 2,062. Meanwhile, Ping An Insurance dropped 1.9% to 64.38. 

Hang Seng closed with losses of 0.94%, weighed down by poor results in the energy sector. Refineries such as Sinopec, Petrochina, and Cnooc experienced sharp falls.

Moreover, the Hang Seng China Enterprises lost 0.98%.

The four sub-indices closed in red: Commerce and Industry fell by 1%. Finance yielded 0.96%; Services lost 0.84%, and Real Estate declined by 0.44%. 

Meanwhile, the technological Tencent plunged by 0.84%. Alibaba sank by 1.17%, and Xiaomi yielded 0.9%.

Regarding state telecommunications companies, China Mobile lost 1.21%, and China Unicom declined by 1.39%.

The Haidilao restaurant chain posted the best result of the day, surging by 8.69%.

In fact, the business volume of the session was 146.130 million Hong Kong dollars (18.820 million dollars).

European shares advance despite Covid-19 concerns

An increase in industrial and financial shares pushed European shares higher on Tuesday.

At the moment of writing, the pan-European STOXX 600 was up by 0.5%. Industrials, retail companies, and banks gained between 0.4% and 1.1%.

London’s FTSE 100 UKX advanced by 0.2%, while London’s FTSE 100 UKX added 0.11%. In Paris, CAC 40 px1 climbed by 0.34% and Frankfurt’s DAX DAX added 0.3%. Additionally, the German DAX increased by 0.6%.

A resurgence of the reflation trade characterized early European trade. Consequently, stocks that were forecasted to benefit from continued economic recovery received a boost. 

The mining, industry, and financial sectors were the biggest gainers on the StockX 50 SX5E, adding 0.43%.

Indices of the largest companies in Europe and significant indices across the continent became placed in positive territory.