Asian shares mostly higher; Tokyo slips as virus cases surge

A woman walks past a bank's electronic board showing the Hong Kong share index in Hong Kong Thursday, April 8, 2021. Shares were mostly higher in Asia on Thursday after a mixed close on Wall Street, where gains for several Big Tech stocks nudged the S&P 500 to a second record high in three days. (AP Photo/Vincent Yu)

People walk past a bank's electronic board showing the Hong Kong share index in Hong Kong Thursday, April 8, 2021. Shares were mostly higher in Asia on Thursday after a mixed close on Wall Street, where gains for several Big Tech stocks nudged the S&P 500 to a second record high in three days.(AP Photo/Vincent Yu)

People walk past a bank's electronic board showing the Hong Kong share index in Hong Kong Thursday, April 8, 2021. Shares were mostly higher in Asia on Thursday after a mixed close on Wall Street, where gains for several Big Tech stocks nudged the S&P 500 to a second record high in three days.(AP Photo/Vincent Yu)

BANGKOK (AP) — Shares were mostly higher in Asia on Thursday though Tokyo’s benchmark declined as reports of rising coronavirus cases raised alarm over another setback in the recovery from the pandemic.

Tokyo reported 545 new cases and Osaka's government declared a medical emergency as the latest surge in infections outpaced minimal progress in inoculating people against COVID-19.

The Nikkei 225 index slipped 0.1% to 29,708.98, while the Hang Seng in Hong Kong jumped 1.2% to 29,014.57. In Seoul, the Kospi edged 0.2% higher to 3,143.26. Australia's S&P/ASX 200 gained 1% to 6,998.80. The Shanghai Composite index added 0.1% to 3,481.70.

U.S. futures were higher.

On Wednesday, the benchmark S&P 500 inched up 0.1% to 4,079.95. The Dow Jones Industrial Average gained 0.1% to 33,446.26. The Nasdaq composite slipped 0.1% to 13,688.84. The S&P 500 and Dow each set record highs on Monday.

Small company stocks, which have been outgaining the broader market this year, took the brunt of the selling. The Russell 2000 index of smaller companies gave up 1.6%, to 2,223.05. The index is up 12.6% so far this year, while the S&P 500, which tracks large companies, is up 8.6%.

The broader market has been mostly subdued this week as investors remain cautiously optimistic about the economic recovery. Vaccine distribution has been ramping up and President Joe Biden has bumped up his deadline for states to make doses available to all adults by April 19. The vaccines are helping to fuel a recovery, but the virus is still very much a threat as variants are discovered and threaten additional lockdowns.

Analysts expect the economy to recover this year, but they also anticipate the market remain choppy as investors shift money to companies and industries that stand to benefit as the pandemic eases.

The yield on the 10-year Treasury was steady at 1.66%. A sharp increase in bond yields since the beginning of the year reflects a growing concern among investors that inflation could return as economic growth heats up and the U.S. pulls out of its pandemic-induced recession. Higher yields can slow down the economy by making it more expensive for people and businesses to borrow money.

Shares were little changed Wednesday following the release of minutes from the Federal Reserve’s latest meeting on interest rate policy.

The minutes revealed that Fed officials were encouraged last month by evidence the U.S. economy was picking up, but they showed no sign of moving closer to ending their bond purchases or lifting their benchmark short-term interest rate from nearly zero.

Fed policymakers also said they expect inflation will likely rise in the next few months because of supply bottlenecks, but they believe it will remain near their 2% target over the longer run.

Investors were reassured by the Fed’s “very optimistic and balanced tone of more growth and transitory inflation,” Stephen Innes of Axi said in a commentary.

“And it keeps U.S. investors in the candy store mode while feeding off the infrastructure stimulus sugar rush.”

The minutes are from a Fed meeting that came before last week’s March jobs report, which showed a surprisingly strong 916,000 positions were added that month, the most since August, and the unemployment rate fell to 6% from 6.2%.

In other trading, benchmark U.S. crude oil lost 56 cents to $59.21 per barrel in electronic trading on the New York Mercantile Exchange. It picked up 44 cents to $59.77 per barrel on Wednesday. Brent crude, the international standard for pricing, gave up 56 cents to $62.60 per barrel.

The U.S. dollar slipped to 109.72 Japanese yen from 109.85 yen. The euro rose to $1.1877 from $1.1868.