Asia Markets

Japan falls nearly 2% as fears of coronavirus economic fallout continue to grip investors

Key Points
  • Shares in Asia fell on Thursday.
  • Seasonally adjusted employment in Australia fell by 594,300 people in April as compared to March, according to data released by the Australian Bureau of Statistics on Thursday.
  • U.S. Federal Reserve Chairman Jerome Powell said Wednesday that more may need to be done to support the economy.

Stocks in Asia fell on Thursday as a data release showed employment in Australia falling in April.

In Japan, the Nikkei 225 fell 1.74% to close at 19,914.78 while the Topix index also shed 1.91% to finish its trading day at 1,446.55. South Korea's Kospi also declined 0.8% to close at 1,924.96.

Mainland Chinese stocks closed lower, with the Shanghai composite down 0.96% to around 2,870.34 while the Shenzhen composite slipped 0.941% to approximately 1,805.70.

Hong Kong's Hang Seng index fell 1.43%, as of its final hour of trading.

Shares of Chinese tech juggernaut Tencent in Hong Kong shed most of their gains but held fractionally higher. The stock had earlier seen a more than two year high after the firm posted its first-quarter earnings which beat expectations. Online games revenue grew 31% year-on-year to 37.3 billion yuan. Total smartphone game revenue came in at 34.7 billion yuan for the March quarter. Analysts at investment bank Jefferies had expected a revenue figure of  31.6 billion yuan.

Elsewhere, the S&P/ASX 200 in Australia closed 1.72% lower at 5,328.70.

Overall, the MSCI Asia-ex Japan index slipped 1.31%.

On the economic data front, seasonally adjusted employment in Australia fell by 594,300 people in April as compared to March, according to data released by the country's Bureau of Statistics on Thursday.

Meanwhile, U.S. Federal Reserve Chairman Jerome Powell said Wednesday that more may need to be done to support the economy.

"While the economic response has been both timely and appropriately large, it may not be the final chapter, given that the path ahead is both highly uncertain and subject to significant downside risks," Powell said in prepared remarks for a webcast event with the Peterson Institute for International Economics.

The U.S. dollar index, which tracks the greenback against a basket of its peers, was last at 100.357 after rising from levels below 100 yesterday.

"The mid-week rise in the USD index (DXY) to 100.2 was not solely attributed to the Fed Chairman Powell's push back against negative US interest rates," strategists at Singapore's DBS Group wrote in a Thursday note. "His warning of a possible deeper and longer recession without additional fiscal stimulus dampened risk appetite."

"Put simply, the stimulus measures that propelled markets in April are still insufficient to ensure recovery," the strategists said. "Optimism from the reopening of economies has also been marred by fears of a second wave of infections and President Trump's China bashing ahead of the US elections in November."

The Japanese yen traded at 106.82 after seeing an earlier low of 107.08. The Australian dollar was at $0.6442 after weakening from highs above $0.654 seen earlier in the trading week.

Oil prices were higher in the afternoon of Asian trading hours, with international benchmark Brent crude futures up 2.26% to $29.85 per barrel. U.S. crude futures also added 2.33% to $25.88 per barrel.

— CNBC's Jeff Cox and Arjun Kharpal contributed to this report.