Asia Markets

Asia stocks little changed; Fed Chair Powell assesses prospects of U.S. economic recovery

Key Points
  • Shares in Asia were little changed on Monday.
  • U.S. Federal Reserve Chairman Jerome Powell told CBS' "60 Minutes" that the economy stateside may need a coronavirus vaccine to fully recover.
  • Japan's economy shrank at an annualized rate of 3.4% in January-March, Reuters reported Monday citing government data. That marked the country's second straight quarter of contraction, meeting the technical definition of a recession, according to Reuters.

Major markets in Asia were little changed on Monday as U.S. Federal Reserve Chairman Jerome Powell said the economy stateside may need a coronavirus vaccine to fully recover.

Mainland Chinese stocks were mixed on the day, with the Shanghai composite up 0.24% to about 2,875.42 while the Shenzhen composite shed 0.427% to approximately 1,800.84. The Hang Seng index in Hong Kong was 0.5%, as of its final hour of trading.

Elsewhere, Japan's Nikkei 225 closed 0.48% higher at 20,133.73 while the Topix index rose 0.38% to end its trading day at 1,459.29. South Korea's Kospi also advanced 0.51% to close at 1,937.11.

Meanwhile in Australia, the S&P/ASX 200 finished its trading day 1.03% higher at 5,460.50.

Overall, the MSCI Asia ex-Japan index was fractionally higher.

Oil prices rose in the afternoon of Asian trading hours on expectations of demand pick-up and supply cuts. International benchmark Brent crude futures rose 4.34% to $33.91 per barrel. U.S. crude futures also added 5.78% to $31.13 per barrel.

Investors watched for reaction to Powell's recent comments to CBS' "60 Minutes."

"Assuming there's not a second wave of the coronavirus, I think you'll see the economy recover steadily through the second half of the year," the central bank chief said. However, he added that "for the economy to fully recover ... that may have to await the arrival of a vaccine."

"There is no question that the outlook remains grim," Vishnu Varathan, head of economics and strategy at Mizuho Bank, wrote in a note. "US-China friction and the inability to plot a path of recovery from COVID leave much up in the air; and arguably, a little much reliance on policy silver bullets to deliver respite."

On the economic data front, the Japanese economy contracted at an annualized rate of 3.4% between January and March, according to data released Monday by the country's Cabinet Office. That was less than a median estimate of a 4.6% decline by economists in a Reuters poll. Still, the shrinking of the economy marked the country's second straight quarter of contraction, meeting the technical definition of a recession, according to Reuters.

Currencies

The U.S. dollar index, which tracks the greenback against a basket of its peers, was last at 100.338 after seeing highs around 100.5 last week.

The Japanese yen traded at 107.19 per dollar after strengthening from levels above 107.6 seen early last week. The Australian dollar changed hands at $0.6441 following a decline from levels above $0.65 in the previous week.

— CNBC's Jeff Cox contributed to this report.