FTSE 100 LIVE: Asia shares struggle amid coronavirus tensions between US and China

FTSE 100 LIVE: Asia shares struggle amid coronavirus tensions between US and China

Worries about confrontations between the two largest economies in the world eclipsed Chinese economic data, which showed it economy is gradually recovering from the shock of the coronavirus outbreak. With China the first to relax lockdowns, global investors are closely watching it for clues on how long demand will take to bounce back, as other countries begin to ease their own anti-virus measures.

MSCI’s broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS were little changed, with gains in Australia offset by falls in Hong Kong.

Japan’s Nikkei ipped 0.3 percent while mainland Chinese shares also ticked lower.

U.S. S&P500 futures ESc1 dipped 0.15 percent after the index gained 1.15 percent the previous day, recovering from a three-week low.

While many analysts regarded the drop as a natural correction after a fast rally since mid-March, they are also increasingly worried about US-China relations as US President Donald Trump blames China for the disease that killed more than 85,000 Americans.

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6.14am update: Coronavirus forces HSBC to cut global growth forecasts

Europe’s biggest bank, HSBC has cut already bleak global growth forecasts even further, as lockdown restrictions extended through April and tentative economic re-openings drag on a return to business, trade and spending.

The bank lowered its 2020 global gross domestic product forecast to a contraction of 4.8 percent, according to a note from chief economist Janet Henry dated May 12 and published on Friday.

It had forecast a 3.3 percent contraction for the year in early April. Many large banks last published growth forecasts around then and the cut could signal another round of dire predictions.

HSBC has downgraded its 2020 forecasts for the developed world from a contraction of 5.9 percent to a contraction of 7.1 percent and for emerging economies from 0.5 percent growth to a 1.7 percent contraction. It forecasts full year US GDP at -7.0 percent and China’s at 1.7 percent growth.

Published at Fri, 15 May 2020 05:07:00 +0000