TOKYO (AP) -- Global shares slipped Monday amid worries over surging coronavirus infections in Asia as well as concerns about the long-term impact from the Afghan government's collapse.
France's CAC 40 fell 0.6% in early trading to 27,523.19, while Germany's DAX slipped 0.3% to 15,929.31. Britain's FTSE 100 declined 0.8% to 7,160.18. U.S. shares were set to drift lower with Dow futures slipping nearly 0.2% to 35,356.00. S&P 500 futures were down 0.2% at 4,455.25.
Japan's benchmark Nikkei 225 sagged 1.6% to finish at 27,523.19, while Australia's S&P/ASX 200 slipped 0.6% to 7,582.50. Hong Kong's Hang Seng dipped 0.8% to 26,181.46, while the Shanghai Composite inched up less than 0.1% to 3,517.34. South Korean markets were closed for Liberation Day, a national holiday.
Analysts said relatively slow vaccination rollouts in Asia are pushing down investor sentiment. Japan, Thailand and Malaysia are among nations that have recently reported record numbers of new daily cases, and vaccination rollouts in many countries have been unsteady or outpaced by virus surges.
“This is stretching out already elongated timelines to herd immunity, necessitating periodic lockdowns to stymie rising infection rates,” said Venkateswara Lavanya at Mizuho Bank in Singapore.
“Asia remains the epicenter of the spread, with the number of COVID cases in Vietnam, the Philippines and Thailand rising over the weekend."
Analysts said the Taliban sweeping into Afghanistan's capital may feel like a faraway event but will undoubtedly affect markets elsewhere, including Asia.
“Yes, markets will try to brush this geopolitical earthquake off: It's just Afghanistan; It's a long way away,” Rabobank said in its daily market commentary. “This geopolitical nightmare is almost certainly only just beginning.”
In Japan, the government reported the economy grew at an annual rate of 1.3% in April-June, raising hopes for a gradual recovery from the damage brought on by the pandemic. Some analysts had expected a contraction. Underlining growth were improved private consumption and residential investment, as well as rising exports and imports.
Also pushing down investor optimism was the University of Michigan consumer sentiment index, which fell to 70.2 from its previous level of 81.2 in July. That was the largest drop in sentiment since April 2020, when the pandemic took its initial grip on the country.
The unexpectedly bad drop in the survey's reading was almost entirely due to the spread of the delta variant of the coronavirus, which has caused hospitals to fill up with unvaccinated patients across the U.S.
In energy trading, benchmark U.S. crude fell $1.21 to $67.21 a barrel. Brent crude, the international standard, lost $1.07 to $69.52 a barrel.
In currency trading, the U.S. dollar fell to 109.38 yen from 109.56 yen. The euro cost $1.1785, down from $1.1791.