Asian shares are down Wall St on weak US services data

Asian stock markets follow Wall Street after weakening US services activity

Market benchmarks declined in Tokyo, Hong Kong and Seoul. Shanghai Advanced.

Overnight, Wall Street’s benchmark S&P 500 index broke a seven-day streak of record closings and fell after the Institute of Supply Management reported services industry activity grew at a slower rate than forecast in June.

The “disappointing decline” suggests the US recovery “is not immune” to the global pocket of a resurgence of the coronavirus, Mizuho Bank said in a report.

The Nikkei 225 in Tokyo fell 1% to 28,366.95 and in Hong Kong the Hang Seng fell 0.9% to 27,813.25.

The Shanghai Composite Index was up 0.7% at 3,557.19 after China’s cabinet announced the imposition of stricter data protection and other standards on Chinese companies wishing to join foreign stock exchanges.

The announcement, at a time when Beijing is tightening controls on technology industries, is a potential hurdle for Chinese entrepreneurs who have raised billions of dollars overseas. This comes after ride-hailing service Didi Global Inc. was ordered to stop new users from signing up and remove its app from online stores while it stepped up protection for customers’ information.

The Kospi in Seoul retreated 0.6% to 3,285.34, while the S&P-ASX 200 in Sydney rose 0.9% to 7,326.90.

India’s Sensex opened 0.2% higher at 52,948.94. New Zealand, Singapore and Jakarta declined.

On Wall Street, the S&P fell 0.2% to 4,343.54 on Tuesday, led by losses for banks and energy companies. The index is up 15.6 percent for the year.

The Dow Jones Industrial Average fell 0.6% to 34,577.37. The Nasdaq Composite rose 0.2% to 14,663.64.

The ISM Purchasing Managers’ Index fell from May’s record 64.0 to 60.1 on a 100-point scale, with numbers above 50 indicating an increase in activity. This was well below the 63.3 expected by forecasters surveyed by the Wall Street Journal.

The travel, hospitality and other service industries have boomed as US restrictions on consumer activity eased.

This pushed up US prices, but the latest measure may support the Federal Reserve’s position that the rise in inflation is temporary. This can help reassure investors that the Fed and other central banks will not feel pressured to hike prices by rolling back economic stimulus.

Also, Didi’s stock fell 19.6% in New York on Tuesday. It fell 5% on Friday after Chinese regulators said they were investigating information security at Didi and two other ridesharing technology companies. Full Truck Alliance, the operator of two truck logistics platforms, fell 6.7% and Kanjhun Ltd., an online recruitment organization, dropped 15.9%.

Amazon jumped 4.7% after the Pentagon said it was canceling a cloud-computing contract with rival Microsoft, which could eventually be worth $10 billion, and would instead strike a deal with both Microsoft and Amazon. Microsoft’s shares were little changed.

In energy markets, benchmark US crude rose 37 cents to $73.74 a barrel in electronic trading on the New York Mercantile Exchange. The contract fell $1.79 to $73.37 on Tuesday. Brent crude, the base for international oil pricing, rose 32 cents to $74.85 a barrel in London. It fell $2.63 to $74.53 in the previous session.

The dollar rose to 110.72 yen from Tuesday’s 110.63. The euro rose from $1.1826 to $1.1828.


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