ILUSTRASI. Passersby wearing protective face masks following an outbreak of the coronavirus disease (COVID-19) are reflected on a screen displaying stock prices outside a brokerage in Tokyo, Japan, March 17, 2020. REUTERS/Issei Kato
KONTAN.CO.ID - SYDNEY (Reuters). Asian share markets took a cautious turn on Wednesday as a resurgence of global coronavirus cases challenged market confidence in a rapid economic recovery, even as the rebound in U.S. retail sales in May broke all records.
New infections have hit record highs in six U.S. states and Beijing cut flights and closed schools to contain a fresh outbreak in the Chinese capital.
“A serious second wave of cases in major developed countries is the biggest risk facing equity markets,” said Shane Oliver head of investment strategy at fund manager AMP Capital.
“However, provided any second wave is relatively mild in terms of pressure on health systems and the number of deaths, its unlikely to reap the havoc seen back in March.”
Geopolitics also lurked as a worry with India reporting 20 of its soldiers had been killed in clashes with Chinese troops at a disputed border site.
North Korea rejected a South Korea offer to send special envoys and vowed to send back troops to the border.
It was enough to inject a note of caution into trading and Japan’s Nikkei eased 0.5%, after jumping almost 5% on Tuesday for its biggest daily gain in three months.
MSCI’s broadest index of Asia-Pacific shares outside Japan went flat, having climbed 2.8% the previous day, with most markets across the region little changed.
Chinese blue chips slipped 0.4% and E-Mini futures for the S&P 500 0.2%. EUROSTOXX 50 futures and FTSE futures both dithered either side of flat.
That followed a robust session on Wall Street overnight. The Dow ended Tuesday up 2.04%, while the S&P 500 gained 1.90% and the Nasdaq 1.75%.
Hopes for recovery had been bolstered by data showing U.S. retail sales jumped by a record 17.7% in May, recovering more than half the losses of the previous two months, though industrial output still lagged.
The Trump administration was also reportedly preparing an up to $1 trillion infrastructure package, something that was initially promised more than three years ago.
Past the worst