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Asian stocks opened weaker on Tuesday on concerns about further pandemic closures in Europe and after reports about financial institutions allegedly moving illicit funds hurt global banking stocks.
FILE PHOTO: A man wearing a protective mask, following a coronavirus (COVID-19) outbreak, walks past a screen displaying the Nikkei index outside a broker in Tokyo, Japan, on March 13, 2020. REUTERS / Athit Perawongmetha
HONG KONG / NEW YORK: Asian equities extended losses for a second day on Tuesday as the dollar rose as possible delays in expanded US stimulus and concerns about further pandemic closings in Europe hit investor sentiment .
Hong Kong shares of HSBC and Standard Chartered fell more than 2 percent each as global banking stocks came under intense pressure on reports of financial institutions allegedly moving illicit funds.
British lenders HSBC and StanChart are among the global lenders who have transferred more than $ 2 trillion in shady funds over nearly two decades.
MSCI’s broader Asia-Pacific stock index outside of Japan was down 0.5%.
Australia’s S & P / ASX 200 fell 0.7% under pressure from mining companies and energy stocks, while China’s first-class index lost 0.1% and Hong Kong’s Hang Seng index fell 0.5%. Japanese markets were closed for public holidays.
After hours trading pointed to increased selling pressure on Wall Street on Tuesday, with S&P 500 futures down 0.2% in early Asia and Nasdaq 100 futures down 0.4%. .
“We can’t see any positive news on the horizon anytime soon for markets to rebound,” said Steven Leung, executive director of institutional sales at Hong Kong brokerage UOB Kay Hian.
Overnight on Wall Street, the Dow Jones Industrial Average fell 1.84%, the S&P 500 lost 1.16% and the Nasdaq Composite fell 0.13%.
US stocks have tumbled for the past three weeks as investors shed tech-related heavyweight stocks after an impressive rally that took the S&P 500 and Nasdaq to new highs.
JPMorgan Chase & Co and Bank of New York Mellon Corp fell 3.1% and 4.0%, respectively, on Monday.
“The question is whether or not the residue of that impacts regional financial performance,” said CommSec market analyst Tom Piotrowski in Sydney.
The coronavirus also remains at the center of investor concerns.
New pandemic measures in the UK triggered declines in airline, hotel and cruise companies in the European and US markets, raising fears about further restrictions.
The Telegraph newspaper reported that Prime Minister Boris Johnson will encourage Britons on Tuesday to go back to work from home. Any new coronavirus restriction would threaten a nascent recovery and put even more pressure on stock markets.
Concerns are also mounting about a delay in stimulus measures after the US Congress has been stalled for weeks on the size and shape of another coronavirus response bill, in addition to the roughly US $ 3 trillion already enacted into law.
The death of US Supreme Court Justice Ruth Bader Ginsburg seemed to make the passage of another stimulus package in Congress less likely before the November 3 presidential election, causing large declines in the retail sector. health.
US President Donald Trump said he would present his candidate on Friday or Saturday and asked the Senate, controlled by his fellow Republicans, to vote on confirmation before the election.
The dollar maintained strong gains on Tuesday, with modest movements in Asia due to a public holiday in Japan. The euro held steady at $ 1.1764 and the yen, which fell by a six-month high as the dollar rose, rose to 104.56 per dollar.
The Australian dollar fell a fraction to $ 0.7218 after a senior central banker pointed out the possibility of policy options, including currency market intervention and negative interest rates to support the economy.
Gold fell against the higher dollar and last traded at $ 1,908.76 an ounce.
In oil markets, US crude rose 0.66% to $ 39.57 a barrel, while Brent gained 0.31% to $ 41.95.
(Reporting by Suzanne Barlyn and Sumeet Chatterjee; Editing by Sam Holmes and Shri Navaratnam)
