Asian shares dipped in thin holiday trade on Monday as fears lingered over the impact of the Omicron coronavirus variant.
The highly transmissible strain has sent new cases skyrocketing across the globe, with countries reviving lockdowns, major sports leagues cancelling fixtures, and cruise ships returning to port with Covid-infected passengers.
US airlines have cancelled or delayed thousands of flights over the past three days due to Covid-related staff shortages, while several cruise ships had to cancel stops after outbreaks on-board.
Even in China, where a “zero-Covid” strategy has largely kept infections in check, officials recorded 206 new infections Sunday – a count tiny by worldwide standards, but the country’s biggest such figure in 21 months.
Tokyo fell 0.4%, while Shanghai and Seoul also ended lower. Hong Kong and Sydney were closed for a holiday.
“Omicron cases are surging in the US and Europe, and although markets have well and truly priced in a less virulent strain, the disruption to goods and services from isolating workers, notably air travel, seems to be the main fallout so far,” Jeffrey Halley, a senior Asia Pacific market analyst at OANDA said.
“That is only likely to cause short-term nerves, with the global recovery story for 2022 still on track.”
Senior strategist Yoshihiro Ito of Okasan Online Securities warned that “the sense of caution over the spread of infections (due to Omicron) remains strong”.
“The market also lacked strength, with the number of investors limited due to the year-end holiday,” Horiuchi said.
Subdued Trading, US Retail Splurge
In early European trade, Paris was down 0.2%, while Frankfurt was down 0.2%. London was closed for the holiday.
On Friday before the Christmas break, markets wavered in similarly subdued trade.
A day earlier on Wall Street, the S&P 500 ended the last session before the long holiday weekend at a fresh record following a raft of mostly decent US economic data.
And a study released Sunday showed US consumers were in the mood to spend over the holiday season, with retail sales soaring 8.5% over last year.
Online sales were up 11% and in-store sales up 8.1% between November 1 and Christmas Eve, according to the Mastercard SpendingPulse study.
“Consumers splurged throughout the season,” said Steve Sadove, senior advisor for Mastercard and former CEO of Saks Incorporated.
Key figures around 0810 GMT
Tokyo – Nikkei 225: DOWN 0.4% at 28,676.46 (close)
Hong Kong – Hang Seng Index: UP 0.1% at 23,223.76 (Friday close)
Shanghai – Composite: DOWN 0.06% at 3,615.97 (close)
New York – Dow: UP 0.5% at 35,950.56 (Thursday close)
• AFP and Reuters, with additional editing by Jim Pollard
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