Asia report: Markets mixed as South Korea virus cases rise

Markets in Asia finished in a mixed state on Tuesday, as investors remained wary over rising numbers of Covid-19 cases in South Korea, while poring through the latest meeting minutes from Australia’s central bank.

In Japan, the Nikkei 225 was down 0.2% at 21,051.08, as the yen strengthened 0.38% against the dollar to last trade at JPY 105.61.

Of the major components on the benchmark index, robotics specialist Fanuc was down 0.28%, Uniqlo owner Fast Retailing lost 0.11%, and technology giant SoftBank Group was off 0.69%.

The broader Topix index managed to break above the waterline in late trading, ending the day up 0.06% at 1,610.85.

On the mainland, the Shanghai Composite was 0.36% firmer at 3,451.09, and the smaller, technology-centric Shenzhen Composite was 0.49% higher at 2,298.45.

South Korea’s Kospi slid 2.46% to 2,348.24, while the Hang Seng Index in Hong Kong tacked on 0.08% to 25,367.38.

The blue-chip technology stocks were mixed in Seoul, with Samsung Electronics rising 0.69%, while chipmaker SK Hynix lost 2.62%.

Carmakers were also in the red, with Hyundai Motor down 5.39% and Kia Motors 3.83% weaker.

Local news agency Yonhap reported during the day that there were growing concerns that a “massive outbreak” of coronavirus cases was blooming in the country.

The Korea Centers of Disease Control and Prevention reported a total of 246 new Covid-19 cases in the country in the 24 hours to midnight Tuesday.

Geopolitical tensions between Washington and Beijing were once again at the top of the agenda, after the Trump administration announced a fresh round of restrictions on Chinese technology giant Huawei.

The measures are designed to limit the company’s access to commercial chips from American firms.

It came after Trump signed an executive order on Friday, which would force Chinese internet company ByteDance to sell or spin-off its TikTok social network operations in the US within 90 days.

A report from CNBC overnight suggested corporate software behemoth Oracle is in discussions to acquire TikTok’s assets in the US, Canada, Australia and New Zealand, pitting Larry Ellison’s company against Microsoft, which has been mulling a purchase of TikTok for several weeks.

“Asia stocks underwent a mixed session after the US reopened its front against Chinese telecoms giant Huawei as the administration tightened its restrictions on doing business with the company, cutting off access to chipsets that use US technology,” said CMC Markets chief market analyst Michael Hewson.

“Coming on the heels of the US President’s executive order on Friday over TikTok investors are going to have to get used to the idea that tensions between the US and China are only likely to heighten, with investors scrambling to identify who might be next in the US cross hairs, ahead of the November election.

“It might also be prudent if investors looked to areas where the Chinese might look to retaliate, with respect to US business in China.”

Oil prices were lower at the end of the Asian day, with Brent crude last down 0.2% at $45.28 per barrel, and West Texas Intermediate off 0.54% at $42.66.

In Australia, the S&P/ASX 200 rose 0.77% to 6,123.40, as the Reserve Bank of Australia released the minutes from its latest policy meeting.

The central bank said there was “no need to adjust the package of measures in Australia in the current environment” in the minutes.

“Board members recognised that the substantial, coordinated and unprecedented easing of fiscal and monetary policy in Australia was helping to sustain the economy through this difficult period.”

Across the Tasman Sea, New Zealand’s S&P/NZX 50 climbed 1.51% to 11,849.13, with medical equipment maker Fisher & Paykel Healthcare rising 4.29% after a well-received result.

The down under dollars were a mixed affair against the greenback, with the Aussie last 0.21% stronger at AUD 1.3832, while the Kiwi weakened 0.01% to NZD 1.5250.