Asian Stocks Mixed Over “Massive Roller-Coaster” of Uncertainty

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Investing.com – Asian stocks were mixed on Wednesday morning in the wake of U.S. Federal Reserve officials’ comments predicting a slow economic recovery and rising numbers of COVID-19 in the U.S. and Europe.

Fed Chairman Jerome Powell warned on Tuesday that the economy still had a long road ahead before a full economic recovery and required further support, and will testify before the House Select Subcommittee on COVID-19 later in the day. On the same day, Chicago Fed President Charles Evans said that rates could rise before the inflation target of 2% is reached. Evans also warned that the U.S. economy risks a longer, slower recovery and “recessionary dynamics” should the U.S. Congress fail to pass the latest fiscal stimulus package.

Although the U.S. House of Representatives passed a stopgap funding bill to keep the federal government running through December 11, investors are waiting to see whether the Senate will also pass the bill.

Japan’s Nikkei 225 was down 0.64% by 10:57 PM ET (2:57 AM GMT) and South Korea’s KOSPI fell 0.81%.

However, in Australia, the ASX 200 jumped 1.63%.

Hong Kong’s Hang Seng Index was down 0.29%.

China’s Shanghai Composite inched up 0.02% and the Shenzhen Component inched up 0.08%. U.S.-China tensions continue to simmer, after U.S. President Donald Trump told the United Nations General Assembly on Tuesday that China must be held accountable for “unleashing” COVID-19 on the world.

China responded to the comment by accusing Trump of lying and abusing the U.N. platform to provoke confrontation. However, Chinese President Xi Jinping called for enhanced cooperation over the pandemic and stressed that China had no intention of fighting “either a Cold War or a hot war with any country” in his pre-recorded message for U.N. delegates.

Meanwhile, confusion remains over Oracle’s takeover of TikTok’s U.S. operations. State-backed China Daily said on Wednesday that China has no reason to approve the “dirty and unfair” deal based on “bullying and extortion” struck between Oracle Corp (NYSE:ORCL) and ByteDance.”

Meanwhile, the number of COVID-19 deaths in the U.S. surpassed 200,000 as of September 23, according to Johns Hopkins University data. Across the Atlantic, the U.K. introduced new restrictions, likely to be in place for six months and Prime Minister Boris Johnson urged Britons to work from home where possible. With Greece and Denmark also introducing new restrictive measures, fears are mounting that more countries could follow.

Some investors warned that the uncertainty would likely continue for some time.

“This is a massive roller-coaster and you just have to hold your stomach,” Gibbs Wealth Management president and CEO Erin Gibbs told Bloomberg.

“We are most likely to see this continued high volatility” until the U.S. election in November, she said.