World News

'Testing tax' dropped after backlash against charging workers in their salaries

The Treasury has rowed back on plans to tax workers who are given coronavirus tests by their employers. 

Yesterday the Chancellor Rishi Sunak was told to investigate whether the tests should count as a ‘taxable benefit in kind’, after HMRC said had labelled them on its website. 

Mr Sunak hinted yesterday that the plans could be reversed, saying that he would ‘look into’ the issue ‘very quickly’. 

Now the Treasury has said it will make the tests exempt from taxing.  A spokesperson told ‘Given the importance of widespread testing, we want to ensure that all employers who wish to provide third party testing to their employees can do so without increasing their tax liability. So we will introduce a new income tax exemption for Covid-19 antigen tests provided by employers.

‘HMRC will amend their guidance as soon as possible to reflect this change.’

Visit our live blog for the latest updates: Coronavirus news live

Tests for whether people with symptoms currently have the disease are free.

This is a breaking story – more to follow.

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Beauty industry in danger because of ‘male-dominated Government’, claims beauty therapist

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Tracie Giles – who counts model Vogue Williams and reality star Gemma Collins among her clients – questioned why beauty salons remained closed while pubs had reopened. She said: “The general beauty industry is worth nearly £30billion to the UK economy but we have been disregarded as frivolous and unnecessary by the maledominated Government, who are actively choosing to ignore this female-led industry. People’s livelihoods are at stake, with many now unable to work and having to claim benefits and survive off food banks.

“Hundreds of selfemployed practitioners and small businesses in the industry are now being forced to close and the heartbreaking reality is that the Government does not seem to care.”

Ms Giles also highlighted the psychological damage to some of her clients, who visit salons for medical tattooing. It is used to replace eyebrows lost after chemotherapy, for example.

She added: “These patients have now been left with nowhere to go. Yet the psychological suffering alleviated by our cosmetic micropigmentation services, and many other services in the beauty industry, can’t be overlooked.

“This is especially important at this difficult time for the nation, where the significant impact of Covid-19 on people’s mental health should not be underestimated.”

In a bid to reopen her London salon Ms Giles has sanitised it with a new “fogging” anti-bacterial spray developed by UK company FiltaShield.

The company’s commercial director Edward Palin claims it can protect surfaces for up to 30 days.

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World News

Queen heartbreak: Sick joke claiming the monarch is dead panics royal fans

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The Queen’s health was once again at the centre of a disgusting joke by social media user who made the hashtag #ripQueenElizabeth one of the most popular trending topics overnight. Some Twitter users have flooded the platform with this hashtag over the past few hours, making it one of the most popular in the UK and tricking other social media users into thinking the monarch had actually died. 

One worried social media user with the nickname Sev Kudu said: “I actually thought she died?? Why is this trending?”

Social media user FoolOnTheHill said: “I wish people wouldn’t use the #hashtag #RIPQueenElizabeth it isn’t good for my health.

“Our current situation is so serious the last thing the #UK needs is to start worry about losing #OurQueen.”

Another royal fan, Nelson Mario, understanding this hashtag was a spoof, said: “#AsWeBritsLikeToSay boll***s to #ripQueenElizabeth, long may she reign!” 

Another, Codlink78, invited people on the platform not to joke about the monarch’s health conditions.

They said: “#ripQueenElizabeth Not aware of any instance where this hashtag trending on twitter is funny.”

Ice Colder added: “Why do people do stupid trends like #ripQueenElizabeth.” 

A few experienced social media users recalled other instances during which a similar hashtag claiming the Queen had died made it to the front page of Twitter.

Handesh wrote: “Twitter makes us believe that the Queen’s dead every five months #ripQueenElizabeth”.

And Maddie said: “Why does this start trending nearly every three months”.    

The hashtag appears to have originated as a joke among a community of fans of British pop music group One Direction.

Over the past few days, the fans are believed to have also started the hashtags #ripJeffBezos, suggesting the Amazon boss had died, and #ripEllenDeGeneres, referring to the popular US presenter.

The Queen remains in good health and is self-isolating at Windsor Castle with Prince Philip. 

The couple have been staying at their Berkshire residence since March 19, a few days before the Prime Minister put in place a nationwide lockdown.

Over the past three months, the Queen has been seen multiple times.

In early April, the monarch delivered a poignant speech which rallied the country’s spirits as she recalled her first speech to British children in 1940 and quoting Vera Lynn’s most famous song she promised the UK “we will meet again”.

A month later, the Queen marked the 75th anniversary of VE Day by speaking once again to the nation to recall her memories of WW2 and the day it was declared over. 

The Queen also proved to be quite fit when she was photographed on the grounds of Windsor Castle riding her 14-year-old horse.

In June, the monarch also made history as she took part in her first-ever royal engagement via conference call.

During the virtual engagement, the monarch heard the stories of five unpaid carers backed by the Carers Trust and praised their work and daily efforts.

A few days later, the Queen cut a lonely figure at the Quadrangle at Windsor Castle as she watched without any family member a revised and socially-distanced version of the Trooping the Colour parade.   

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World News

PRECIOUS-Gold steadies near more than 8-year peak as virus cases surge

* Gold within striking distance of key $1,800/oz level

* SPDR Gold Trust holdings rise 0.7% on Tuesday

* Spot gold faces resistance at $1,796/oz – technicals

* Interactive graphic tracking global spread of coronavirus: open in an external browser (Updates prices)

By Brijesh Patel

July 8 (Reuters) – Gold held steady near a more than eight-year high on Wednesday, with investors hitting pause on a rally fuelled by a surge in coronavirus cases and hopes of more stimulus measures from the U.S. Federal Reserve.

Spot gold was little changed at $1,794.62 per ounce by 0459 GMT, after hitting its highest since November 2011 at $1,796.93 on Tuesday, just a few dollars away from the key level of $1,800.

U.S. gold futures eased 0.1% to $1,807.80.

“The main focus continues to be on the U.S.,” said Stephen Innes, chief market strategist at financial services firm AxiCorp.

“If the curve continues to steepen and the virus unabated, we are going to break $1,800 just for the fact that the Fed will have to be forced to add more stimulus.”

The U.S. coronavirus outbreak crossed a grim new milestone of more than 3 million infections as more states reported record numbers of new cases.

Compounding economic concerns, the European Commission on Tuesday forecast the euro zone would drop deeper into recession this year and rebound less steeply in 2021 than previously thought.

“The health, financial and economic uncertainties generated by the COVID-19 pandemic and its aftermath are likely to continue to support gold’s rally well into 2021, but at a reduced level,” HSBC analysts said in a note.

Indicative of sentiment, holdings of SPDR Gold Trust rose 0.7% on Tuesday.

Fed officials expressed concern that the surge in virus cases threatened to pinch consumer spending and job gains. One Fed policymaker pledged more support ahead from the U.S. central bank.

Gold tends to benefit from widespread stimulus measures from central banks because it is widely viewed as a hedge against inflation and currency debasement.

Spot gold faces a resistance at $1,796 per ounce, a break above which could lead to a gain to $1,831, said Reuters technical analyst Wang Tao.

Palladium gained 0.3% to $1,921.71 per ounce, platinum rose 0.2% to $836.96 and silver edged 0.2% higher to $18.34.

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Chinese factories to face headwinds in next phase of post-lockdown recovery

BEIJING (Reuters) – Orders for infrastructure materials and equipment have helped industrial output recover faster in China than most places emerging from COVID-19 lockdowns, but further expansion will be hard to attain without stronger broad-based demand and exports.

Prices of copper SCFcv1 and steel SRBcv1 have surged and share prices for Chinese blue chips struck five-year highs, as state-funded infrastructure projects drove up production of cement, steel and non-ferrous metals.

Railway investment, for example, soared 11.4% in April-June from a year earlier versus a 21% drop in the first quarter.

Industries also gained from pent-up demand for autos and electronics. The property sector, a pillar of growth, also showed signs of rebounding, with real estate investment expanding and sales quickening.

China’s factory-gate prices, still in deflation territory this year, may have turned positive on a monthly basis in June, said Yating Xu, senior economist at IHS Markit, in a sign of recovering demand for manufactured goods.

The optimism also led investment bank ING to forecast no more policy interest rate cuts from the central bank for the rest of the year.

“We started to return to thin profit in May and became a bit better in June,” said an official at a state-owned steel mill in central China, declining to be named due to company policy.

“Our demand mainly come from infrastructure so far this year, especially for steel rebar and medium plates,” he said. Steel rebars are mostly used in construction, and medium steel plates in ships and excavators.

Underpinned by robust infrastructure demand from China, the Baltic dry index, which tracks rates for ships ferrying dry bulk commodities and reflects rates for capesize, surged about 257% in June from a low struck in May due to the freeze in global trade as a result of the lockdowns.

The rosy outlook stands in stark contrast to the dismal industrial landscapes of other economies still fighting COVID-19. Factory output plunged further in May from a year earlier in Japan, South Korea and the United States. Euro zone manufacturing output fell by a record 28% in April.

GRAPHIC-Monthly year-on-year industrial production growth for five global economies here


The industrial recovery is expected to help China’s economy post a positive growth rate in the second quarter after contracting for the first time in decades due to COVID-19.

But analysts warn that factories could struggle to keep up momentum even as early as this quarter as pent-up demand wanes, exports struggle and heavy floods take their toll on industries and businesses in the Yangtze Delta.

The pent-up demand for automobiles has been released by now and the auto market entered a traditional lull in June, said the China Passenger Car Association (CPCA) last week. China’s passenger car retail sales fell 8% in June from a year earlier.

In May auto sales rose for the first time after a two-year slump, fanning expectations of a strong V-shaped recovery in a pillar industry, supporting the broader economy. Auto deliveries to dealers also rose for the second straight month in May.

Exports, a sector that provides about 200 million urban jobs, are forecast to come under pressure in the third quarter, analysts say, as sales of COVID-19-related medical supplies slow and global demand stays soft.

Xia Xiaokang, who runs a faucet factory in the eastern city of Wenzhou, shares the same concerns.

After a 10-day production hiatus in May, his factory reopened after receiving the go-ahead from European customers to send suspended shipments and fulfil delayed orders.

“June was better than May, but I’m concerned about July, August and September when countries reopen but orders are so few,” said Xia, adding that his company failed to get any new customers at the online Canton Fair – China’s biggest.

Xu from IHS said global demand may be unable to recover to pre-COVID levels in the next three years.

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World News

The Hong Kong crisis and the new world order

With the UK opening its doors to three million Hong Kong residents and China threatening serious retaliation for what it sees as an intrusion into its domestic affairs, the Hong Kong crisis is becoming a real-time test of diplomacy in a pandemic-distracted world.

So what does this drama tell us about China’s emerging place in the new world order? And what light does it throw on the very particular problems posed, post-Brexit, for the British government’s efforts to roll out a new and optimistic foreign policy under the banner of “Global Britain”?

First off, was this crisis inevitable? Things might have been so very different. For well over two decades, most policy-makers in the West hoped that China’s rise would unfold in a very specific way.

China, it was said, would become a “responsible stakeholder” in the international community. In other words, it would abide by international agreements and norms, because, as part of the system, it benefited from them as much as anyone else.

Maybe in that kind of world, the deal entered into between the British and Chinese governments over Hong Kong’s future would have survived.

But things did not turn out like that. China’s rise was rapid and single-minded. It became a military superpower, at least in its own region, one that close to home, even the mighty United States would struggle to confront.

But its rise also came about at a time when the West in general and the United States in particular was distracted. There was the war on terrorism and the crisis in Syria. Europe had the distraction of Brexit.

And then there was the Trump administration in the United States which has hardly been consistent on China policy – indeed, it has lacked a strategic sense in foreign policy across the board.

China’s rise over the past five years has coincided not just with a relative decline in Washington’s standing abroad, but an absolute decline, plunging Washington’s alliance systems in Asia, Europe and the Middle East into crisis.

While problems between the West and China grew in number, there was no overall response that saw these as elements – trade tensions, technological rivalries, strategic issues and so on – as part of a bigger “China problem” that required a concerted and co-ordinated response.

This was the world on the brink of the Covid-19 crisis; a drama that originated in China and which initially caused some serious problems for Beijing, but one which it was clearly determined to turn to its advantage.

It is no accident then that a more strident nationalist tone in Chinese policy has been the result, ranging from tensions with the US and Australia, Sino-Indian rivalry on their common frontier, and to cap it all, China’s decision to overturn the fundamentals of its deal with the UK over Hong Kong.

Indeed the Covid-19 crisis gave Beijing the opportunity to bring the Hong Kong crisis to a head.

However long this pandemic lasts, one consequence is clear – the trajectory of Beijing’s more assertive policy is unlikely to change unless real and concerted pressure is brought to bear. And for all the condemnation of China’s attitude towards the liberties of the people of Hong Kong, it is hard to see this happening.

This then places the British government in a significant predicament. Mired in mid-pandemic where Prime Minister Boris Johnson government’s handling of affairs has been much criticised, this is the first big test of Britain’s new bullish and re-branded foreign policy – an approach dubbed “Global Britain”.

Nobody really knows quite what “Global Britain” means.

“Making the best of a bad situation” is what many opponents of Brexit might cynically note. And to be fair, with the Covid-19 pandemic taking up so much of the government’s time, it is simply far too early to make any kind of verdict about “Global Britain” on the basis of the Hong Kong experience.

But what this row with China does do is to throw a spotlight on the strengths and weaknesses of the UK’s current diplomatic position. It is important to cut through the high-flown rhetoric and look at the stark reality.

Hong Kong is part of China. Britain is the former colonial power which does not cut much ice in Beijing. China is widely held to have broken its agreement, quite apart from pursuing a whole variety of unpleasant internal security policies. But China is something of a superpower and Britain is decidedly not.

So where does this leave Mr Johnson’s government? many commentators would say to his credit that he has taken a moral stand in offering sanctuary to some three million people from Hong Kong. This is an extraordinary number and is remarkable from a party whose base is highly sceptical about immigration per se.

The fact that China may not allow many people to leave, or that many will decide to stay, or indeed that many, even if they do leave, will go elsewhere in the world, does not alter the fact that Mr Johnson, when faced with Chinese pressure, has tried to retain the high ground.

But diplomacy is made up of many things. Principled action (many might say there is far too little of that in world affairs) is one thing, but achieving one’s foreign policy goals is a team sport. It is about gaining the trust and support of allies, crafting joint positions, and developing joint action.

Here, despite a good deal of rhetorical support for the UK’s position on Hong Kong, little has happened beyond words. The Americans are rolling back some of the trading advantages afforded to the territory of Hong Kong, but then, this is an election year and Mr Trump sees getting tough with Beijing as one element of the strategy that he hopes will keep him in the White House.

But “global Britain” remains unusually isolated. It is semi-detached from Europe; its tangled negotiations over the future of its relationship with the European Union continue.

And its relationship with the Americans is to say the least complicated. For all the bonhomie between Mr Johnson and Mr Trump, the UK badly needs a trade deal with Washington and is always going to be uncomfortable at the thought of whatever quid pro quo may be required for US support.

Indeed, the pandemic highlights such problems in stark terms. Mr Trump has given us an additional understanding of the meaning of “America First” in his decision to buy up the bulk of the supply of the crucial drug remdesivir for treating Covid-19 from its US manufacturer.

The EU is trying to negotiate supplies for its member states. It is not entirely clear where the UK stands in all of this, though press reports quote officials as saying it has secured sufficient supplies for its needs.

This highlights the UK’s current position – in but not of Europe, and close but not that close to Washington. It’s a powerful reminder too of the increasing weight of the economic and technological in global affairs.

UK needs to re-engage

For much of the past century, tanks or nuclear bombs were thought to be the currency of global power. But this was a superficial reading of things, obscuring the fact that, whatever the continuing importance of military hardware, the real reason that the United States dominated in the post-World War Two and Cold War world was its extraordinary economic muscle and research base.

Now China has these attributes too. That is the new world order in which the ship of “global Britain” will have to steer.

The UK has many attributes. Relatively, it remains a rich nation. It still retains a seat in the “directors’ box” of international politics, the UN Security Council. But it is going to have to find a way to re-engage in the post-Covid, post-Brexit world.

Across the globe, there are signs of a growing frustration with Beijing’s bullish policies which perhaps really should now be dubbed “China First”.

The colonial legacy has given the UK a prime role in the unfolding Hong Kong drama. It now needs to play its part in helping to forge a new international consensus on dealing with Beijing: one that at the same time pushes back against Chinese pressure while seeking positively to engage with China’s rulers on the big global issues that matter.

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AirAsia in trading halt after auditor flags 'going concern' doubts

(Reuters) – Shares in Malaysia’s AirAsia Group Bhd (AIRA.KL) were halted on Wednesday after its auditor said there were material uncertainties that cast doubt on the budget carrier’s ability to continue as a going concern.

In an unqualified audit opinion on the airline’s earnings results for 2019, Ernst & Young PLT said the financial statements were prepared on a going concern basis, which is dependent upon a recovery from the COVID-19 pandemic and the success of fundraising efforts.

In response, the airline said in a statement that Malaysia’s stock exchange had granted it 12 months relief from being classified as a financially distressed firm – a classification that would require it to submit a business improvement plan.

Malaysia has also extended the relief to other companies who may face a hit to business from the pandemic.

Like airlines around the world, AirAsia has been hit hard by the coronavirus which has decimated travel demand. It posted a first-quarter loss of 803.3 million ringgit ($188 million), its biggest loss for the quarter since its listing in November 2004.

The company said last month it was evaluating proposals for raising capital to strengthen its equity base and liquidity.

AirAsia management has guided that an equity raising via a placement or rights issue looks imminent, Affin Hwang Capital analyst Isaac Chow wrote in a note to clients on Tuesday.

AirAsia did not comment on the fund raising efforts.

The trading halt is due to be lifted from 2.30 p.m. local time (0630 GMT) on Wednesday, a release to the exchange said.

Finance Minister Tengku Zafrul Aziz told Reuters in June that the ministry had not provided financial aid to any of the country’s airlines and that the airlines have said they “can do okay, on their own.”

AirAsia said on Monday there were ongoing deliberations for joint ventures and collaborations that might result in additional third-party investments in specific segments of the group’s business.

It has also sought payment deferrals from suppliers and lenders and halted all deliveries of Airbus SE (AIR.PA) jets this year as it seeks to cut costs.

AirAsia’s shares have halved in value so far this year, giving it a market capitalisation of around $670 million.

Elsewhere in the region, Thai Airways International PCL (THAI.BK) and Virgin Australia Holdings Ltd (VAH.AX) have entered bankruptcy protection due to their inability to pay creditors.

($1 = 4.2750 ringgit)

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Singapore's Korean start-up centre to host first batch for incubation programme in October

SINGAPORE – South-east Asia’s first Korean start-up centre set up in Singapore will receive its inaugural batch of six enterprises in October for an eight-week incubation programme, Enterprise Singapore (ESG) said on Wednesday (July 8).

The K-Startup Centre’s first incubation programme will focus on fintech and cyber security. It will be hosted by NUS Enterprise, the entrepreneurial arm of the National University of Singapore (NUS).

The centre, officially launched in Seoul on Wednesday by South Korea’s Ministry of SMEs and Startups (MSS), will serve as a launchpad for Korean small and medium-sized enterprises (SMEs) and start-ups to plug into the start-up and innovation ecosystem in Singapore and the region.

Supported by ESG, the centre will also catalyse opportunities for Korean start-ups to co-develop and commercialise solutions with Singapore enterprises.

In a video message on Wednesday, Trade and Industry Minister Chan Chun Sing said the launch of the K-Startup Centre during this period “gives us confidence that we can continue to make progress in our economic cooperation despite Covid-19”.

He added that the centre will facilitate mutually beneficial partnerships. Korean enterprises can benefit from access to mentors, innovation networks, and physical space to grow, while Singaporean firms can also tap this platform to partner Korean counterparts in creating innovative solutions and to scale up, he said.

ESG said the launch reflects the strong interest among Korean start-ups to anchor in Singapore to drive their internationalisation plans despite the uncertainties brought on by Covid-19. It noted that close to a third of the 276 applications received by the Korea Institute of Startup and Entrepreneurship Development (KISED) for its outbound incubation programmes this year chose to come to Singapore.

ESG is also working closely with KISED, an MSS affiliate, on start-up activities that will use the K-Startup Centre as an operations base to facilitate collaboration between both countries.

ESG assistant CEO Tan Soon Kim said Singapore’s start-up ecosystem will benefit from the dynamic innovation and technology expertise that Korean start-ups and SMEs are renowned for.

Ms Joy Moon, KISED programme manager, said Korean start-ups are using the pandemic as an opportunity to expand new business models and digital solutions at home, and scale abroad. She said that with Singapore’s connectivity, pro-business environment and renowned start-up ecosystem, the new centre will accelerate their efforts to springboard into Asia.

A Korean start-up centre here was first mooted during South Korean President Moon Jae-in’s visit to Singapore in July 2018. Similar centres in Sweden and Finland were also launched at the same event on Wednesday.

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Dollar holds advantage as coronavirus fears weigh on markets

TOKYO (Reuters) – The dollar held onto gains on Wednesday as a resurgence of the coronavirus in the United States and the return of lockdowns in some countries boosted safe-haven demand for the U.S. currency.

Risk sentiment was also undermined after Federal Reserve officials expressed concern that rising coronavirus cases could harm economic growth just as stimulus measures start to expire.

The yuan fell slightly against the dollar, halting a two-day rally, after the Chinese central bank’s daily midpoint for the currency was set at a weaker than expected level.

Other Asian currencies straddled narrow ranges as a resurgence of coronavirus cases threatened a return of lockdown restrictions, leaving investors fretting about the mounting economic costs of the pandemic.

“The mood changes day by day, but the dollar looks to be supported for now as investors turn more cautious about the virus,” said Yukio Ishizuki, foreign exchange strategist at Daiwa Securities.

“The Fed’s comments on the economy sound sombre. There’s reason to worry because it is hard to see when the virus will be brought under control.”

The dollar traded at 107.58 yen JPY= on Wednesday following a 0.3% gain on Tuesday.

Against the euro, the dollar was quoted at $1.1278, also holding to a 0.3% gain from the previous session.

The greenback bought 0.9428 Swiss franc CHF=EBS, little changed on the day.

Sterling GBP=D3 changed hands at $1.2554 and was quoted at 89.86 pence per euro EURGBP=D3.

The pound was near three-week highs as traders awaited British finance minister Rishi Sunak’s announcement later on Wednesday of his next moves to prevent a wave of job cuts from damaging an already weakened economy.

Equities weakened and U.S. Treasury yields edged lower as the number of confirmed coronavirus cases in the United States pushed past 3 million on Tuesday, according to a Reuters tally, stoking fears that hospitals will be overwhelmed.

The United States has the highest known numbers of coronavirus cases and deaths in the world.

Adding to the cautious tone, three Fed officials expressed concern that the surge in infections threatens to pinch consumer spending and job gains just as some stimulus programmes are set to expire.

One Fed policymaker pledged more support ahead from the U.S. central bank.

Some traders warn that the dollar could break out of its range against the yen because currency options are set to expire later Wednesday and Thursday.

The onshore yuan CNY=CFXS eased slightly to 7.0200, pulling back from an almost four-month high reached on Tuesday amid speculation the People’s Bank of China is trying to check the currency’s gains.

While China’s industrial output has recovered faster than most other countries, further expansion will be hard to attain without stronger, broad-based demand and a turnaround in exports.[CNY/]

The Australian dollar AUD=D3 was little changed at $0.6939 following a 0.4% decline on Tuesday. Sentiment for the Aussie has taken a hit after coronavirus lockdown measures were reimposed in Australia’s second biggest city of Melbourne on Tuesday.

The New Zealand dollar NZD=D3 was little changed at $0.6545.

Graphic: World FX rates in 2020 here

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Asian shares waver with coronavirus, focus turns to corporate earnings

SYDNEY/NEW YORK (Reuters) – Asian stocks dithered on Wednesday as an increase in coronavirus cases in some parts of the world undermined prospects for a quick economic recovery while oil prices eased on oversupply fears.

European futures weakened with those for Eurostoxx 50 and Germany’s DAX down 0.7% each. London’s FTSE futures slipped 0.85%.

MSCI’s broadest index of Asia-Pacific shares outside Japan inched up but was still lower than a 4-1/2-month high reached just on Tuesday.

Chinese shares flickered between green and red through most of the day and were last up 0.9%.

Australian shares ended 1.5% lower on renewed fears about the coronavirus pandemic after a rise in cases in the country’s second biggest city.

New Zealand finished 0.3% lower while South Korea was off 0.2%. Japan’s Nikkei fell 0.8%.

E-mini futures for the S&P 500 declined 0.25%.

Overnight, U.S. stocks fell, halting a five-day winning streak by the benchmark S&P 500 index, its longest this year and driven by better-than-expected economic data.

Following the recent rally, the declines looked like a consolidation, with the markets largely in “wait and see mode” ahead of the upcoming earnings session, said NAB economist Tapas Strickland.

Second-quarter earnings season will begin in earnest from next week.

“It will be important to watch the number of U.S. deaths in coming weeks and whether greater questions will be asked about the extent of necessary restrictions,” Strickland said.

California reported more than 10,000 coronavirus cases on Tuesday, a record rise for a single day that also surpassed the number of contact tracers recently trained by the state to detect and prevent potential outbreaks.

Coronavirus cases were also on the rise in the Australian state of Victoria, which led to lockdown measures being reimposed in Melbourne, the country’s second-biggest city.

“The second wave of infection will see Victorian economic activity fall sharply and it will continue to lag the rest of Australia,” said NAB economist Kaixin Owyong.

Victoria makes up around a quarter of Australian economic activity, she said.

Citi analysts predicted global equities would hang around current levels in twelve months’ time.

“We expect bullish and bearish forces to cancel each-other out,” they said in a note. “We would not chase markets higher from current levels, but would prefer to wait for the next dip.”

Citi has “overweight” positions on U.S. and Emerging Markets equities.

Most major currencies were trapped in a range.

The U.S. dollar was flat on the Japanese yen at 107.52.

The risk sensitive Australian and New Zealand dollars were a shade weaker at $0.6936 and $0.6541, respectively.

The euro was barely changed at $1.1272.

In commodities, gold hovered near a recent 8-1/2 year peak as investors preferred safe-haven assets. Spot gold was last flat after two straight days of gains at 1,794.1 per ounce.

Brent crude futures fell 11 cents, or 0.28%, to $42.96 a barrel. U.S. West Texas Intermediate (WTI) crude futures slipped 15 cents, or 0.15%, to $40.47 a barrel.

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