By Gina Lee
By Gina Lee
Investing.com – Asia Pacific stocks were down on Tuesday morning, with a possible delay in passing U.S. stimulus measures leading to a choppy U.S. session overnight. Ever-rising numbers of global COVID-19 cases also soured investor sentiment.
Japan’s Nikkei 225 was down 0.82% by 10:34 PM ET (3:34 AM GMT).
South Korea’s KOSPI fell 1.56%. The Bank of Korea said earlier in the day that the country’s fourth quarter GDP rose 1.10% quarter-on-quarter, higher than the 0.7% growth in forecasts prepared by Investing.com but below the 2.1% growth recorded for the third quarter.
Hong Kong’s Hang Seng Index slid 2.31%. The city’s Secretary for Food and Health Sophia Chan on Monday approved the Pfizer Inc (NYSE:PFE) -BioNTech SE (F:22UAy) COVID-19 vaccine for the first roll-out in Hong Kong, expected to start after Lunar New Year holidays next month.
China’s Shanghai Composite was down 1.20% while the Shenzhen Component fell 2.24%.
Australian markets are closed for a holiday.
Worries about the timing and amount of further U.S. stimulus emerged after Democratic Majority Leader Chuck Schumer warned a comprehensive deal could be four to six weeks away. But he added that some COVID-19 relief measures could be passed before former President Donald Trump’s second impeachment trial begins in early February.
President Joe Biden is willing to negotiate on the $1.9 trillion stimulus package he proposed earlier in the month with Republican lawmakers. But with Democrats now in control of Congress, a Democrat-only route has so far not been ruled out.
“The immediate question now is when stimulus aid will be approved and how much?” MAI Capital Management chief equity strategist Christopher Grisanti told Reuters.
The Senate also voted 84-15 to confirm Janet Yellen as Secretary of the Treasury, the first woman in the role. Yellen is now expected to move quickly on COVID-19 relief, review U.S. sanctions policy and strengthen financial regulation.
Amid the recent rally seen in global shares, investors are searching for fresh catalysts to drive them higher, or to justify the current valuations at least.
For now, all eyes are on the Federal Reserve’s policy meeting, which opens today with a policy decision to be handed down on Wednesday. The focus will also be on a slew of U.S. economic data to be released throughout the week, including the GDP for the fourth quarter.
Global shares are currently taking a breather after a strong bull run last week, but some investors remained optimistic despite the downhill trend.
“Risk appetite has clearly improved … central banks and governments need to keep their foot on the accelerator,” Kiwibank chief economist Jarrod Kerr told Reuters.