Asian shares recover, mood still brittle
Asian shares rebounded on Monday as a wave of bargain hunting surged across beaten-down markets. China has also not recorded any new local transmissions of COVID-19 for the first time since July, although the mood remained generally on edge.
MSCI’s broadest index of Asia-Pacific shares outside Japan rose 1.5% on Monday, recovering from its 4.8% loss in the previous week.
Meanwhile, Japan’s Nikkei jumped 1.7%, following its 3.4% drop last week. Chinese blue chips steadied at 1.2% from their three-week low.
A raft of “flash” manufacturing surveys for August out on Monday will provide early signs of how global growth is doing against the threat of the Delta variant, with analysts anticipating drops, particularly in Asia.
In Japan, factory activity growth slowed down in August, while that of other services sectors went down at the fastest pace since May 2020, highlighting the impact of the COVID-19 measures on the economy.
In China, worries over the country’s economy have flared in recent weeks, while Beijing’s regulatory crackdown on the tech sector dealt a double blow to markets.
Over $560 billion were cleaned out from Hong Kong and mainland China exchanges in the previous week as funds stressed over which sectors regulators might target next.