Most Asian stock markets were mixed on Tuesday, as recent losses made people look for deals. However, losses in technology stocks and worries about more COVID-19 cases in China put pressure on most major bourses.
China’s blue-chip The Shanghai Shenzhen CSI 300 index dropped 0.1%, while the Shanghai Composite index remained unchanged. Both indexes have lost a lot over the past four sessions as the country deals with its worst COVID-19 outbreak yet.
Due to a record-high rise in daily infections, curbs were put back in place in Beijing, Shanghai, and other major cities. The markets were worried that stricter rules could slow down economic growth in the country again and cause more problems in the global supply chain.
Technology-heavy bourses did some of the worst on Tuesday, following the NASDAQ Composite’s big drop overnight. The Hang Seng index in Hong Kong fell 1.5%, while the KOSPI in South Korea fell 0.5%.
Overnight, Wall Street ended down, with tech stocks selling off the most as Federal Reserve officials kept pushing back against market expectations for a “dovish pivot.” Several members said the bank is likely to raise rates by a smaller amount in the coming months, but they didn’t think it would stop raising rates any time soon.
This means there will be more pressure on regional markets, which have dropped sharply this year as monetary conditions around the world have tightened. This trend hurt technology stocks the most because investors didn’t think the sector would make money in the future.
Most Asian central banks have also started raising interest rates this year to keep up with the Fed. They have also said they plan to raise rates more to fight rising inflation.
Malaysian stocks fell 0.8%, making them the worst performers in Southeast Asia for the second day in a row. This was because a political stalemate after a very close general election showed no signs of breaking.
On the other hand, Japan’s Nikkei 225 index went up by 0.6% after Warren Buffet’s Berkshire Hathaway (NYSE: BRKa) bought more shares in the five biggest trading houses in the country.
Australian stocks also went up by 0.6%, with big bank stocks going up the most because people think the Reserve Bank will raise interest rates again.
The blue-chip Nifty 50 index in India went up by 0.3% because pharmaceutical and bank stocks went up.