Major indexes in China and Korea fall at least 1% as oil’s recent rally pauses

SINGAPORE — Shares in Asia-Pacific tumbled on Tuesday, with major indexes from China to South Korea falling at least 1%.

The Hang Seng index in Hong Kong dropped 1.02% by Tuesday afternoon.

Shares of China Evergrande New Energy Vehicle, on the other hand, surged nearly 6% after the firm vowed on Monday to start producing electric vehicles next year. The company is linked to debt-laden developer Evergrande, which has already missed multiple coupon payments for its bonds in recent weeks.

Mainland Chinese stocks also declined, with the Shanghai composite down 1.04% while the Shenzhen component shed 0.984%.

South Korea’s Kospi dropped 1.53%. In Japan, the Nikkei 225 slipped 1.02% while the Topix index shed 0.77%.

Australian stocks also fell into negative territory, erasing earlier gains, as the S&P/ASX 200 shed 0.37%.

MSCI’s broadest index of Asia-Pacific shares outside Japan fell 1.02%.

Oil prices were lower in the afternoon of Asia trading hours, taking a pause following a recent surge above $80. International benchmark Brent crude futures dipped fractionally to $83.61 per barrel while U.S. crude futures shed 0.15% to $80.40 per barrel.

“The rise in energy prices is fuelling concerns that the transitory lift in inflation seen in the wake of the pandemic may prove to be longer lasting,” Tapas Strickland, an economist at National Australia Bank, wrote in a Tuesday note.

The recent jump in oil prices comes as a rebound in global demand contributed to power shortages in major economies such as China. Last week, the Organization of the Petroleum Exporting Countries and its allies — a group collectively referred to as OPEC+ — also opted against a supply boost, further fueling the oil price rally.

Overnight stateside, the Dow Jones Industrial Average fell 250.19 points to 34,496.06 while the S&P 500 slipped 0.69% to 4,361.19. The Nasdaq Composite shed 0.64% to 14,486.20.

The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 94.329 after a recent bounce from below 94.2.

The Japanese yen traded at 113.32 per dollar after yesterday’s weakening from below 112.8 against the greenback. The Australian dollar changed hands at $0.734, above levels around $0.73 seen earlier in the trading week.