SYDNEY, March 15 (Reuters) - Asian stocks were in the red on Tuesday as surging COVID-19 cases in China hit the confidence of investors who are already worried about the Ukraine war and the first U.S. interest rate rise in three years, which could come this week.
TOKYO, March 15 (Reuters) - Oil prices slid to a two-week low on Tuesday on continued ceasefire talks between Russia and Ukraine and concerns about demand in China after a surge in COVID-19 cases.
BEIJING, March 15 (Reuters) - China's economy perked up in the first two months of the New Year, with key indicators all exceeding analysts' expectations, although a surge in COVID-19 cases, a property downturn, and heightened global uncertainties weigh on the economic outlook.
Industrial output rose 7.5% in January-February from a year earlier, the fastest pace since June 2021 and up from a 4.3% increase seen in December, data from National Statistics Bureau showed on Tuesday. That compared with a 3.9% surge in a Reuters poll.
Retail sales, a gauge of consumption that has been lagging since COVID hit, expanded 6.7% year-on-year amid rising demand during the Lunar New Year holidays and Winter Olympic Games. It also marked the quickest clip since June last year and beat expectations of a 3.0% increase in the poll.
It eked out a 1.7% gain in December.
The surprisingly strong performance of the world's second-largest economy in the New Year came after China's economy was losing momentum as a liquidity crunch in the property market and strict anti-virus measures hit consumer confidence and spending.
"Indeed, every data point has been rebounding, mainly because policy effect kicked in early this year, with loosening in the infrastructure and property sectors. Catering spending also remained relatively strong," said Qu Qing, chief economist at Jianghai Securities.
However, some analysts warned the strength may not last as China now turns its focus back to battling the more infectious Omicron strain across a larger number of Chinese cities in March. read more
"I don't think we should be fooled by the surprisingly strong Jan-Feb data ... We should still cut interest rates and reserve requirement ratios as soon as possible," said Wang Jun, chief economist at Zhongyuan Bank.
"There should not be any hesitation in terms of the support from loosening policies."
On Tuesday, China's central bank kept some of its policy rates unchanged in its market operations, dashing expectations for a cut, although investors believe policymakers may resume monetary easing soon to prop up the cooling economy.
Premier Li Keqiang said on Friday that he is confident of hitting this year's economic growth target of around 5.5% despite challenges including the war in Ukraine. Li also vowed to provide more policy support in the year. read more
The economic activity is normally impacted in January and February because of the week-long Lunar New Year holiday, which fell in February of 2022. For the third year in a row, many factory workers stayed put during the holiday due to COVID control measures and kept factory floors humming.
Fu Linghui, the spokesman for the statistics bureau, said sales related to the Winter Olympic Games helped boost January-February retail sales.
The mascot Bing Dwen Dwen has been an unexpected star of the Beijing Olympics, with thousands of fans lining up in sub-freezing temperatures to buy merchandise - from magnets and key chains to bags and stuffed toys - and factories scrambling to make more. read more
INFRASTRUCTURE STRONG
Fixed asset investment rose 12.2% on year compared with the 5.0% increase tipped by the Reuters poll and 4.9% growth in 2021. The figure was the highest since July last year.
Fu from the statistics bureau attributed the strong growth to a speedup of infrastructure projects on the ground as China increases spending. Infrastructure rose 8.1% in the January-February period.
The downturn in the property market also showed signs of easing, but sales are still mired in contraction while new construction starts fell by double digits.
Property investment rose 3.7% from a year in the first two months of 2022, following a 13.9% slump in December, data showed.
Property sales by floor area fell 9.6% year-on-year in the first two months of the year, versus the 15.64% decline seen in December
HONG KONG, March 14 (Reuters) - The yen slid to a new five-year low on Monday, ahead of a bumper week of central bank meetings around the world which will almost certainly reaffirm the Bank of Japan's position as one of the last dovish central banks standing.
BEIJING, March 14 (Reuters) - Oil prices extended last week's decline to fall by about $4 a barrel during early trade on Monday after a U.S. official said Russia was showing signs it might be willing to have substantive negotiations over Ukraine.
SYDNEY, March 14 (Reuters) - Most share markets firmed and oil slid on Monday on hopes for progress in Russian-Ukraine peace talks even as fighting continued to rage, while bond markets braced for rate rises in the United States and the UK this week.