Asian shares mixed after retreat on Wall Street

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A man walks past a bank's electronic board showing the Hong Kong share index at Hong Kong Stock Exchange Thursday, May 20, 2021. Shares were mixed in Asia on Thursday after benchmarks closed broadly lower on Wall Street in a third day of retreat. (AP Photo/Vincent Yu)

TOKYO – Shares were mixed in Asia on Thursday as Japan reported strong trade data signaling a recovery in demand from the pandemic.

Stocks rose in Tokyo and Sydney but fell in Hong Kong and Shanghai. The price of Bitcoin and other cryptocurrencies steadied.

Japan's government reported that exports rose 38% in April from a year earlier while imports climbed nearly 13%, indicating a recovery in overseas demand even as the country weathers its worst bout of coronavirus outbreaks so far.

Exports to the U.S. rose 45% while those to China jumped nearly 34% in a strong rebound after last year's shocks from lockdowns and other precautions taken to curb the pandemic.

While better than forecast, the figures largely reflect the low base from the depths of the pandemic lockdowns in 2020 and exports are likely to rise at a lower pace going forward, said Tom Learmouth of Capital Economics.

“While export volumes edged higher in April, the rebound in exports is slowing and external demand is unlikely to provide much of a tailwind to growth over the coming months," he said in a commentary.

The Nikkei 225 regained lost ground, edging 0.2% higher to 28,098.25, while Sydney's S&P/ASX 200 surged 1.3% to 7,019.60. In Hong Kong, the Hang Seng slipped 0.5% to 28,451.83 while Seoul's Kospi declined 0.3% to 3,162.28. Shares rose in Singapore and Jakarta but fell in Taiwan. India's Sensex was little changed.

On Wednesday, the S&P 500 index dropped 0.3% to 4,115.68 after recovering from a 1.6% slide earlier in the day. The benchmark index is on track for its second weekly loss in a row.

The Dow Jones Industrial Average fell 0.5% to 33,896.04. The Nasdaq fared better than the rest of the market, shedding less than 0.1%, to 13,299.74.

Smaller company stocks also lost ground. The Russell 2000 index lost 0.8%, to 2,193.64.

Bank stocks and companies that rely directly on consumer spending pulled the market lower, but energy sector stocks, the biggest gainers so far this year, bore the heaviest losses as the price of U.S. crude oil skidded 3.5%.

On Thursday, U.S. benchmark crude oil added 31 cents to $63.66 per barrel in electronic trading on the New York Mercantile Exchange. It dropped $2.50 on Wednesday to $63.35 per barrel. Brent crude, the international standard for pricing, rose 24 cents to $66.90 per barrel.

Digital currencies fell sharply Wednesday after China’s banking association issued a warning Wednesday over the risks associated with digital currencies.

But Bitcoin’s price stabilized Thursday, rising 0.5% to $39,726, according to the crypto news site Coindesk. It dropped more than 6% on Wednesday, swinging in a huge range of as low as $30,202 and as high as $43,621 over the course of the day. It hit its all-time high of over $64,800 a month ago,

Bitcoin's gyrations followed the news that longtime Bitcoin advocate Tesla would no longer accept it as payment for its cars, reversing its earlier position.

Investors remain focused on whether rising inflation will be temporary or whether it will endure. Prices are rising for everything from gasoline to food as the economy recovers from its more than year-long malaise.

The fear is that the Federal Reserve will have to dial back its extensive support if inflation persists. That includes record-low interest rates and the monthly purchase of $120 billion in bonds meant to goose the job market and economy.

The minutes from the central bank’s April meeting of policymakers, which were released Wednesday afternoon, reaffirmed the view that the Fed’s decision to keep its benchmark interest rate ultra-low remains the best policy approach, though some officials cautioned that some factors pushing inflation higher may not be resolved quickly.

Treasury yields mostly rose. The yield on the 10-year Treasury note slipped to 1.66% from 1.67% late Wednesday.

The dollar fell to 109.09 Japanese yen from 109.23 yen on Wednesday. The euro rose to $1.2191 from $1.2174.