Asian Stocks Down, Regional COVID-19 Outbreak Unnerve Investors By Investing.com

By Gina Lee

Investing.com – Asia Pacific stocks were mostly down on Tuesday morning, as the soured risk sentiment.

Japan’s fell 0.91% by 10:47 PM ET (2:47 AM GMT). Data released earlier in the day said the grew 0.1% year-on-year in July, while the contracted 0.1% year-on-year. grew 0.2% month-on-month in July.

South Korea’s edged down 0.14%. with the country’s growing a better-than-expected 2.6% year-on-year in July. The Bank of Korea also released the meeting.

In Australia, the was down 0.26%. contracted 6.7% month-on-month in June, while fell 11.8% in the same month.

Hong Kong’s fell 0.88%. China’s was down 0.30% while the jumped 2.25%.

The will hand down its policy decision for August later in the day, with the following on Thursday and the on the following day.

The global spread of COVID-19, and its Delta variant, continues to be of concern to investors. China has seen cases spread to inland cities from the coast, with restrictive measures re-implemented to curb the latest outbreak. Investors also continue to monitor shares in China and Hong Kong, as China continues to tighten regulation in sectors including technology and private education.

“It’s a challenging time for Asian equities with the uncertainty that has been created by the regulatory measures… there was some handholding from the China Securities Regulatory Commission (CSRC) last week to limit the spread of the contagion and counter the popular thinking of which sector is next. That worked for a few days but then we saw the flows start to reverse again,” BNP Paribas (OTC:) Asset Management head of Asian equities Zhikai Chen told Reuters.

Meanwhile, U.S. data released on Monday that was robust but softer also soured investor sentiment. The was a better-than-expected 63.4 in July, while the was a lower-than-expected 59.5. The ISM manufacturing employment index was a better-than-expected 52.9 in July.

Meanwhile, the debate on when the U.S. Federal Reserve will begin asset tapering and hike interest rates continues. Fed Governor Christopher Waller said he could back an asset tapering announcement by September 2021 should the next two monthly U.S. employment data show continued gains.

Investors now look to the latest U.S. jobs report, including , due on Friday, to gauge the labor market’s recovery. But for some, it was a matter of priorities.

“I don’t think the market is concerned about the Delta variant as much as it’s concerned about how it impacts inflation… the longer we have Delta spread globally, the longer the supply chain disruptions will continue,” Spotlight Asset Group chief investment officer Shana Sissel told Bloomberg.