Hong Kong Stocks End Two-day Rally Over Virus Fears

Hong Kong stocks closed slightly lower on Thursday following a two-day advance, with traders weighing signs of a second wave of virus infections against huge stimulus support.

The Hang Seng Index dipped 0.1 percent, to 24,464.

On the mainland, the Shanghai Composite Index rose 0.1 percent, to 2,939 and the Shenzhen Composite Index gained 0.2 percent, to 1,908.

After starting the day on the back foot, regional equities clawed back losses and some managed to shift into positive territory.

Tokyo ended down 0.5 percent while Sydney slipped 0.9 percent after data showed a massive jump in Australian job losses.

Wellington was also down 1 percent after news the New Zealand economy suffered its worst contraction for almost three decades in the first quarter.

Seoul slipped 0.4 percent, while Bangkok and Jakarta were also down.

But Singapore added 0.3 percent, Mumbai climbed 0.7 percent, Taipei put on 0.1 percent and Manila rallied more than 1 percent.

"There is no doubt that economic activity is recovering from its worst levels," said Stephen Innes at AxiCorp. "We can see that in numerous official and anecdotal reports. Still, financial data is thought to be unreliable these days and the positive knock-on effects seem to be losing swagger quickly as we all know the economic nasties are coming down the road."

There is also a lot of fear among investors that while countries are slowly reopening their economies – with flights resuming, bars, cafes and restaurants serving people and professional football coming back – new infections continue to surge in some places and are flaring up again in others.

Eyes are on Beijing, which has imposed new lockdowns, reclosed schools and banned flights again after the emergence of new clusters linked to markets, while there have also been massive spikes in Texas and Florida. (AFP)