Asian stock market: Mixed amid trade/virus fears, stimulus announcements

• Fears of coronavirus resurgence, trade war signs weigh over RBNZ, India stimulus.
• Republicans propose a bit to enable US President Donald Trump to levy sanctions on China.
• Fed Chair Powell’s speech will top the busy calendar, trade/virus updates will be the key.

Despite the upbeat performance of shares in India, Hong Kong and South Korea, Asian equities dwindle amid risk-off sentiment while heading into the European session on Wednesday. The cautious mood seems to take clues from China’s trade war with Australia and the US, coupled with the fears of the second wave of the virus outbreak.

While portraying the mixed sentiment, MSCI’s index of Asia-Pacific shares ex-Japan rises over 0.30% but Japan’s NIKKEI registers the same 0.30% losses to 20,310 by the press time.

RBNZ’s QE expansion and downbeat comments from the policymakers fail to lure New Zealand stock buyers whereas Indian equities are rallying over 2.0% after PM Narendra Modi announced $266 billion worth of stimulus to combat the coronavirus (COVID-19).

Further, escalation of fresh virus cases from South Korea, Germany and China keeps the risk-tone heavy but KOSPI and HANG SENG are mildly positive by the time of writing.

China banned Aussie meat and said not related to the allegations for the virus outbreak but ASX traders don’t believe in the dragon nation’s comments. On the other hand, the US Republicans are putting a bill that will enable President Donald Trump to impose sanctions on China if it doesn’t give details of the virus spread.

It’s worth mentioning that the Wall Street extended losses on Tuesday with the US 10-year Treasury yields declining below 0.70%.

Moving on, UK’s data dump, including the preliminary reading of Q1 2020 GDP, will gain immediate market attention ahead of the US PPI. Though the most important event will be the Fed Chair Jerome Powell’s speech at 13:00 GMT. Traders will be more interested in the explanation of why the Fed rate can’t plunge negative, as widely anticipated, during 2021.