Asian stock markets slip after a bright start to the week
January 25 2021 09:17 PM
A pedestrian looks at an electronic stock board displaying the Nikkei 225 Stock Average outside a se
A pedestrian looks at an electronic stock board displaying the Nikkei 225 Stock Average outside a securities firm in Tokyo. The Nikkei 225 closed 0.7% up at 28,822.29 points yesterday.

AFP /London

Asian stock markets had initially risen but later turned lower yesterday.
Tokyo’s Nikkei 225 closed 0.7% up at 28,822.29 points, Hong Kong’s Hang Seng ended 2.4% up at 30,159.01 points and Shanghai’s Composite finished 0.5% higher at 3,624.24 points.
Sentiment in Asia was boosted by a report that China had surpassed the United States to be the largest recipient of foreign direct investment in 2020 with $163bn in inflows.
European stock markets headed south after opening higher, as France was reportedly set for a fresh lockdown over the coronavirus pandemic.
“A somewhat drab start to European trade has highlighted the detrimental impact of the lockdown measures seen throughout the region, with traders casting aside the optimism seen throughout Asia overnight,” noted Joshua Mahony, senior market analyst at IG trading group. “France looks set for a third lockdown, with the spread of the UK strain likely to bring further travel restrictions.”
MSCI’s broadest index of Asia-Pacific shares outside Japan rose 1.2% to 727.24, close to last week’s record high of 727.31.
The benchmark is up nearly 9% so far in January, on track for its fourth straight monthly rise.
Australian shares added 0.4% after the country’s drug regulator approved the Pfizer/BioNTech Covid-19 vaccine with a phased rollout likely late next month.
The dollar traded flat against a basket of currencies at 90.228.
Major currency trading pairs were trapped in a tight range as markets awaited the Federal Reserve’s Wednesday meeting.
The euro was lower 0.1% at $1.2160, while sterling was last up 0.1% at $1.3688.
The Japanese yen was last a touch lower at 103.80 per dollar.
In commodities, Brent gained 0.5% to $55.71 a barrel and US crude rose 0.6% to $52.67.
Gold rose 0.5% to $1,860 an ounce.
Border restrictions were, meanwhile, being tightened around the world yesterday, after a weekend in which anger at social distancing rules bubbled over into fiery clashes in the Netherlands.
The United States was set to join France, Israel and Sweden in pulling up the drawbridge to certain arrivals, with special concern about new strains of the pathogen that originated in Britain and South Africa.
Elsewhere, investors kept tabs on the progress of US President Joe Biden’s economic rescue package.
Lawmakers in Washington are getting to work on the $1.9tn stimulus proposal from the new president, with some suggesting they could pass something before the Senate holds an impeachment trial of Donald Trump, which starts in the week beginning February 8.
But it will likely face headwinds from Republicans who think another massive outlay comes too soon after the $900bn spending package passed at the end of last year.
The Federal Reserve will also hold its first meeting under the Biden administration this week, with investors looking for clues about its plans for monetary policy.
On Friday, the Dow fell 0.57%, the S&P 500 lost 0.30% and the Nasdaq added 0.09%.The three main US indexes closed higher for the week, with the Nasdaq rising over 4%.
“Small/Mid (SMID) cap earnings were more impacted by the pandemic, and we project an earnings rebound more than 2x larger than the S&P 500,” said BoFA strategists in a note.
“Historically, when Democrats control both the White House and Congress, SMID-cap returns have exceeded large cap.
Also, SMID-caps are more domestically-oriented, which should benefit from on-shoring and infrastructure spending.”

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