TOKYO – (AP) – Global stocks fell mainly on Tuesday as concerns over China eroded investor optimism after a mixed result on Wall Street.
The French CAC 40 lost 1.4% at the start of the session to 6,561.06. The German DAX slipped 0.8% to 15,443.31. The UK FTSE 100 lost 0.4% to 7,035.80. US stocks were expected to pull back, with the Dow Industrials’ futures down 0.4% to 34,617.00. The S&P 500 future lost 0.7% to 4,404.25.
In Asia, the Japanese benchmark Nikkei 225 fell 0.2% to end at 30,183.96. The Australian S & P / ASX 200 slipped 1.5% to 7,275.60. South Korea’s Kospi lost 1.1% to 3,097.92. Hang Seng of Hong Kong added 1.2% to 24,500.39. The Shanghai Composite Index climbed 0.5% to 3,602.22.
An electricity crisis in parts of China has closed factories and left some households without electricity in a bid to meet official energy consumption targets. This could have global repercussions, including on the supplies needed for manufacturing across Asia, just before the end-of-year shopping season.
This is in addition to the shortages of parts and raw materials that are already plaguing regional manufacturing due to supply disruptions caused by the coronavirus pandemic.
Analysts believe China’s power shortage could be prolonged as demand for coal and natural gas increases during the winter.
Another lingering market concern originating in China is the possible collapse of one of China’s largest real estate developers, Evergrande Group, which is struggling to avoid default on billions of dollars in debt.
“Crucially, the risks of contagion are significant due to transmission within the real estate industry due to similar risks to homebuyers and banks via on-balance sheet exposures,” said Vishnu Varathan of the Asia Treasury Department. and Oceania from Banque Mizuho. “The point is, Evergrande is at best a risk that has temporarily eased but is far from over.”
The vote for the leader of the ruling party in Japan, scheduled for Wednesday, also weighed on Tokyo trade, analysts said, as players took a wait-and-see stance. Four candidates are in the race to replace Prime Minister Yoshihide Suga, who is stepping down after a year in office. No major changes in the economy or foreign policy are expected, as the pro-American Liberal Democratic Party has ruled Japan almost continuously over the past decades.
Consumer spending has been the main driver of the economic recovery and has been partly held back by the increase in COVID-19 cases due to the highly contagious delta variant, which remains a major concern in Asia.
In energy trading, benchmark US crude added 73 cents to $ 76.18 a barrel in electronic trading on the New York Mercantile Exchange. It gained $ 1.47 to $ 75.45 a barrel on Monday.
Brent crude, the international standard, rose 68 cents to $ 80.21 a barrel.
In currency trading, the US dollar rose from 110.00 yen to 111.26 Japanese yen. The euro cost $ 1.1679, compared to $ 1.1684.
Yuri Kageyama is on Twitter https://twitter.com/yurikageyama
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