Japan’s Nikkei finished 0.37% lower, South Korea’s Kospi fell 0.43%, Shanghai’s benchmark shed 0.48% and an index of blue chips declined 0.22%
Stocks in Asia weakened with crude oil in holiday-thinned trading on Monday, as uncertainty over the economic impact of the Omicron variant of coronavirus weighed on investor sentiment.
U.S. 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.
In Asia, China reported its highest daily rise in local Covid cases in 21 months over the weekend as infections more than doubled in the northwestern city of Xian.
Japan’s Nikkei finished 0.37% lower, while South Korea’s Kospi fell 0.43%.
Mainland Chinese shares weakened, with Shanghai’s benchmark shedding 0.48% and an index of blue chips declining 0.22%. That’s despite property stocks getting a lift after China’s central bank vowed to promote healthy development of the country’s real estate market.
Australia, Hong Kong and Britain are among markets closed Monday for holidays.
Omicron cases are surging in the U.S. 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, said Jeffrey Halley, senior Asia Pacific market analyst at OANDA. That is only likely to cause short-term nerves, with the global recovery story for 2022 still on track.
Wall Street trading resumes later in the day after a holiday on Friday. U.S. stocks ended at records on Thursday amid signs Omicron may cause a milder level of illness, even as the highly transmissible strain led to a surge in case numbers around the world.
Emini futures point to a 0.05% rise for the S&P 500 when it reopens.
Safe-haven U.S. Treasuries saw demand in Tokyo trading, with 10-year yields dropping to 1.4824%, declining further from Thursday’s high just above 1.5%.