Asian markets mostly lower on worries about pandemic damage

HONG KONG: Most Asian equities retreated Wednesday after a two-day rally as investors closely track developments in the coronavirus crisis, while the oil market continued to fluctuate ahead of a crucial producers' meeting.

While the deadly disease continues to sweep across the planet, signs that the rate of infections is possibly levelling out and countries are preparing to ease some lockdown restrictions have instilled a semblance of optimism this week.

However, the scale of the fight was laid bare by official data showing France's economy suffered its worst contraction during the first three months of this year since just after World War II.

The French central bank said that in the last two weeks of March, as the coronavirus crisis deepened, economic activity plunged 32 percent.

"Signs that the number of new daily coronavirus cases is topping out in Western Europe is driving expectations that social distancing measures will be lifted soon," said Stephen Innes, at AxiCorp.

"Relaxing of social distancing rules is providing the undercurrent of positivity in the markets."

However, uncertainty about how long the crisis will last and the damage it will inflict on the global economy was keeping traders on edge and hobbling any sustainable rally.

Wall Street, where all three main indexes soared at least seven percent at the start of the week, struggled to extend its rally and turned into negative territory Tuesday.

The losses bled into Asia, with Hong Kong losing more than one percent, Singapore two percent, and Sydney and Seoul each 0.9 percent.

Shanghai ended down 0.2 percent, while Manila and Jakarta also saw steep falls.

Tokyo, however, rose more than two percent as Japan's government unveiled details of a $1 trillion stimulus package, Mumbai added 0.8 percent and Taipei piled on 1.4 percent. Wellington also rose.