Asian shares mostly higher as focus shifts to virus recovery

Shares advanced Wednesday in Asia after a worldwide rally spurred by hopes that a COVID-19 vaccine will help the global economy return to normal.

Benchmarks advanced in Tokyo, Hong Kong, Seoul and Sydney but fell in Shanghai after new Chinese regulations focused on technology companies prompted selling in that sector.

The proposed regulations issued Monday for public comment give guidelines on how China’s 2008 anti-monopoly law will be applied to internet companies. The announcement gave no indication operators are accused of wrongdoing but cited areas where regulators might look for problems including sharing of information and alliances or pricing services below cost to keep out new competitors.

E-commerce giant Alibaba’s shares plunged 8.4% even as the company was in the midst of its annual Singles Day sales festival. Tencent, owner of the popular WeChat social media platform, sank 5.1% and online retailer JD.com tumbled 7.6%.

The Shanghai Composite index declined 0.3% to 3,349.17.

In Hong Kong, the Hang Seng rebounded from early losses, adding 0.3% to 26,375.48.

Other regional markets also were mostly higher. Japan’s Nikkei 225 index gained 1.8% to 25,349.60 and the S&P/ASX 200 jumped 1.7% to 6,449.70. South Korea’s Kospi rose 1.3% to 2,485.03. India’s Sensez fell 0.2% and shares in Taiwan were higher.

On Wall Street, stocks downshifted on Tuesday after a powerful worldwide rally the day before. It was the second straight day that rising hopes for a COVID-19 vaccine pushed investors to reorder which stocks they see winning and losing.

Treasury yields and oil held onto their big gains from a day earlier or added some more amid strengthened confidence in the economy.

The S&P 500 dipped 0.1% to 3,545.53, after erasing most of an early loss. The Dow Jones Industrial Average gained 0.9% to 29,420.92 and the Nasdaq composite dropped 1.4%, to 11,553.86.

The week got a strong start after Pfizer announced Monday that a potential COVID-19 vaccine it’s developing with German partner BioNTech may be 90% effective, based on early but incomplete test results.

Stocks of smaller U.S. companies, which tend to move more with expectations for the economy than their bigger counterparts, rallied again. The Russell 2000 index of small-cap stocks gained 1.9% to 1,737.01, finally returning to where it was in January. It’s just 0.2% below its record high set in 2018.

High prices for Big Tech stocks that carried the stock market through the pandemic, are now facing more scrutiny. Tech stocks have soared through 2020 on expectations they’ll continue to thrive if the economy is in lockdown mode. But that’s left their prices looking expensive even after accounting for their huge profits.

Amazon fell 3.5%. It also is facing antitrust charges filed by European Union regulators on Tuesday that accuse it of using its access to data to gain an unfair advantage over merchants using its platform.

Microsoft fell 3.4%, and Facebook lost 2.3%. Those drops have outsized effects on the S&P 500 because they’re some of the largest companies in the index by market value.

The S&P 500 is already up 8.4% for November, helped by hopes for a coronavirus vaccine and clearing uncertainty about U.S. leadership after Democrat Joe Biden clinched the last of the 270 electoral votes needed to become the next president. Republicans, meanwhile, appear likely to keep control of the Senate.

Some analysts are speaking of a “Goldilocks” scenario where low tax rates and other pro-business policies remain while a more stable and predictable set of policies comes out of the White House.

Many risks remain, and the biggest may be whether investors have become too convinced about a potential COVID-19 vaccine just as c oronavirus counts surge at worrying rates across the U.S. and Europe, prompting some governments to restore restrictions on businesses.

“The biggest downside risk remains COVID and how severe this wave is going to be,” Craig Erlam of Oanda said in a commentary. “COVID is impossible to ignore, particularly with cases soaring once again and deaths on the rise.”

With fresh help for the U.S. economy from Congress still undecided, pressure is on central banks to step up support for markets.

“In fact, the end of this year could provide the perfect cocktail of widespread monetary and fiscal easing, combined with one or more vaccines,” Erlam said.

President Donald Trump’s refusal to concede and cooperate with Biden’s transition team is another source of uncertainty, especially as some Republicans including Senate Majority Leader Mitch McConnell rally behind Trump’s efforts to fight the election results.

Still, optimism remains across markets.

The yield on the 10-year Treasury was steady at 0.98%, close to its highest level since March.

Benchmark U.S. crude oil gained 45 cents to $41.81 per barrel in electronic trading on the New York Mercantile Exchange. It rose 2.7% to settle at $41.36 per barrel on Tuesday. Brent crude, the international standard, picked up 46 cents to $44.07 per barrel.

In currency dealings, the dollar was flat at 105.31 yen Japanese yen. The euro was nearly unchanged at $1.1819.

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AP Business Writer Joe McDonald in Beijing contributed.