May 7, 2021

Stock Markets in Asia Resume Their Slide

Dismal U.S. jobs data on Friday and fresh worries about Europe’s ability to deal with the debt crisis engulfing some of the euro zone states prompted investors once again to dump stocks and flee into assets deemed safer, like gold and U.S. Treasuries

On Monday, in Germany, the Dax index plummeted 5.3 percent, the FTSE 100 in Britain lost 3.6 percent, and several Asian stock markets fell well over 2 percent.

Stock markets in the Asia-Pacific region continued to sink Tuesday, though less dramatically.

By midmorning, the Nikkei 225 index was 1.2 percent lower, while the benchmark indexes in Singapore, Hong Kong and South Korea lost 0.9 percent.

The Taiex in Taiwan and the S. P./ASX 200 in Australia were down 1.1 percent, and in mainland China, the Shanghai composite index slipped 0.4 percent.

“Key economic data continues to disappoint as global business sentiment surveys weakened further and the U.S. employment report printed well below market expectations,” analysts at Barclays Capital said in a research note.

“Increasing concerns over global growth appear to have halted the brief rally in risk assets in the last week of August,” they said, adding that investors are likely to remain edgy, and financial markets volatile, over the next few weeks.

U.S. markets had taken a major battering on Friday, with falls of more than 2 percent, after data showed the U.S. economy had added no jobs in August.

Futures on the Standard Poor’s 500 index were 2.3 percent lower in early Asian trading on Tuesday, indicating that the market is likely to sag again when Wall Street reopens. The U.S. market was closed for Labor Day on Monday.

U.S. Treasuries jumped, pushing the yield on the 10-year Treasuries to 1.92 percent, a record low, according to Bloomberg News.

Gold was trading at just under $1,900 an ounce, not far off a nominal record high of just over $1,913, hit late last month. The precious metal is seen as a haven in times of uncertainty, and its sharp ascent in recent weeks has reflected the global nervousness that has built up this year.

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