Most Asian stocks dipped Wednesday after a technology selloff weighed on U.S. equities and as investors assessed the omicron virus-strain outbreak.
Shares slipped in Japan, technology stocks retreated in Hong Kong and China edged down. U.S. futures fluctuated after the S&P 500 and the Nasdaq 100 weakened Tuesday, snapping four sessions of gains. Volumes remained thin into the end of the year in some markets.
Sentiment in China is being sapped by Beijing’s tightening oversight of overseas share sales and economic risks from a property slowdown. Authorities are expected to add stimulus next year to steady expansion.
Treasury yields fell and a dollar gauge inched higher. Crude oil held around a one-month high partly on bets that the global recovery will ride out omicron. Bitcoin was around $48,000 after a tumble that hinted at diminished ardor for the most speculative assets.
Investors are rounding out the year by booking some profits after a 17% jump in global equities. The coronavirus, Federal Reserve policy tightening and China’s outlook are among the key risks for 2022. Omicron fears are easing on growing evidence that the fast-spreading strain leads to milder symptoms.
“We are pretty constructive going into 2022,” Katie Nixon, chief investment officer for Northern Trust Wealth Management, said on Bloomberg Television. “We’re having fits and starts related to this omicron variant of course. This will create maybe demand delayed but not destroyed.”
On China, Nixon said much stronger policy action is needed in 2022 to bolster growth and help reignite interest in emerging-market equities, which otherwise will remain one of the big uncertainties for investors.
In the latest U.S. data, the Richmond Fed’s manufacturing survey rose in December, beating estimates. Growth in U.S. home prices cooled modestly in October after soaring during the pandemic.
“We’re sober about potential headwinds that still could be coming, even the rest of this year, but early in 2022 — the Fed is going to be raising rates, that will change things for the markets,” Ann Miletti, head of active equity at Allspring Global Investments, said on Bloomberg Television. “We are also hopeful because as you look at a lot of the economic data, it remains strong.”