Asian shares recovered from early losses on Tuesday as investors weighed the near-term costs of the coronavirus infections in China against the longer-term benefits of a complete reopening of the world’s second-largest economy.
MSCI’s broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) edged up 0.5%, having been down more than 1.0% in choppy early trading.
Liquidity was lacking as Japanese markets were shut for a holiday, making for some choppy moves. Nikkei futures were trading at 25,750 compared with the last close for the cash index (.N225) of 26,094.
A batch of surveys had showed China’s factory activity shrank at the sharpest pace in nearly three years as COVID-19 infections swept through production lines.
“China is entering the most dangerous weeks of the pandemic,” warned analysts at Capital Economics.