Global shares mixed as pandemic uncertainty squelches buying

Global shares are mixed as uncertainty over the coronavirus pandemic saps the buying enthusiasm that recently has been pushing prices higher

TOKYO — Global shares were mixed Wednesday as uncertainty over the coronavirus pandemic sapped the buying enthusiasm that has been driving prices higher.

France’s CAC 40 slipped 0.6% in early trading to 5,015.65, while Germany’s DAX was down 0.3% at 12,581.38. Britain’s FTSE 100 edged up nearly 0.2% to 6,200.27. U.S. shares were set to drift higher with Dow futures up 0.3% at 25,856.0. The S&P 500 future contract gained 0.3% to 3,146.12.

Given the current murky outlook, investors are likely to cash in on recent gains, analysts said.

“Investors are trying their best to look through the knotty COVID-19 economic entanglement. Still, you can see why they might be more prone to booking some profits on upticks,” Stephen Innes, chief global market strategist at AxiCorp, said in a report.

But the recent bullish mood remains on shaky ground, and could easily sour, he said.

“It is impossible for investors not to grow weary and eventually, at some point, fall prey to the endless drip of negative COVID-19 stories and how the second wave virus will crush the market,” he added.

Japan’s benchmark Nikkei 225 dropped 0.8% to finish at 22,438.65. Australia’s S&P/ASX 200 dipped 1.5% to 5,920.30. South Korea’s Kospi shed 0.2% to 2,158.88. Hong Kong’s Hang Seng rose 0.6% after fluctuating during much of the day to 26,129.18, while the Shanghai Composite bounced higher, adding 1.7% to 3,403.44.

Although some Asian benchmarks fell, trading overall was relatively calm, said Jeffrey Halley, senior market economist at Oanda. Much of the regional concern is focused on the rising cases in the U.S. as Asia needs a recovery there to attain growth, he said.

“Unfortunately, when America catches a cold, the world catches the flu; that maxim has not changed. It does have the potential to delay and depress the world’s nascent recovery,” said Halley.

Optimism that the U.S. economy is on the mend as businesses reopen has helped drive stocks higher. But the recent surge in new coronavirus cases has clouded hopes for a relatively quick economic turnaround. Investors are also girding for what the next few weeks will reveal about the health of corporate America as companies begin reporting their second-quarter results.

“It’s not unusual for these five-day runs to be met with a bout of profit-taking, especially given the headlines on the virus,” said Quincy Krosby, chief market strategist at Prudential Financial. “When you move toward overbought conditions it doesn’t take much for the market to burn off some of the froth.”

Unprecedented amounts of aid from central banks and governments around the world are helping to prop up markets. But the worsening infection levels across much of the U.S. are countering that support.

Benchmark U.S. crude lost 17 cents to $40.45 a barrel in electronic trading on the New York Mercantile Exchange. It slipped a penny to settle at $40.62 per barrel on Tuesday. Brent crude, the international standard, fell 5 cents to $43.03 per barrel.

The dollar inched down to 107.50 Japanese yen from 107.53 yen on Tuesday. The euro rose to $1.1287 from $1.1274.