Asian shares up, Shanghai slips as virus fears cloud outlook

A woman wearing a face mask walks past a bank's electronic board showing the Hong Kong share index at Hong Kong Stock Exchange in Hong Kong Monday, Sept. 27, 2021. Asian share rose Monday, but skepticism about the economic outlook for the region tempered the rally amid worries about further waves of COVID-19 outbreaks. (AP Photo/Vincent Yu)

People wearing face masks walk past a bank's electronic board showing the Hong Kong share index at Hong Kong Stock Exchange in Hong Kong Monday, Sept. 27, 2021. Asian share rose Monday, but skepticism about the economic outlook for the region tempered the rally amid worries about further waves of COVID-19 outbreaks. (AP Photo/Vincent Yu)

A woman wearing a face mask walks past a bank's electronic board showing the Hong Kong share index at Hong Kong Stock Exchange in Hong Kong Monday, Sept. 27, 2021. Asian share rose Monday, but skepticism about the economic outlook for the region tempered the rally amid worries about further waves of COVID-19 outbreaks. (AP Photo/Vincent Yu)

People wearing face masks stand in front of a bank's electronic board showing the Hong Kong share index at Hong Kong Stock Exchange in Hong Kong Monday, Sept. 27, 2021. Asian share rose Monday, but skepticism about the economic outlook for the region tempered the rally amid worries about further waves of COVID-19 outbreaks. (AP Photo/Vincent Yu)

TOKYO (AP) — Asian shares were mostly higher Monday, but fears of further waves of coronavirus outbreaks were clouding the economic outlook for the region, tempering the rally.

Japan's benchmark Nikkei 225 rose 0.3% to 30,35.62. Australia's S&P/ASX 200 gained 0.7% to 7,393.60. South Korea's Kospi added 0.6% to 3,142.08. Hong Kong's Hang Seng added 1.2% to 24,479.52, while the Shanghai Composite shed 0.5% to 3,595.97.

Japan's ruling party holds an election later this week to choose a leader, who is likely to succeed Yoshihide Suga as prime minister after just one year in office. All the candidates are certain to stick to the nation's pro-U.S. policies, despite some nuances in their views.

They also are all promising to boost government spending to try to catalyze growth in the world's third largest economy.

Analysts also say Japan’s central bank “tankan” economic survey for the third quarter, due out Friday, likely will show a deterioration in business conditions because of various disruptions to supply chains and renewed outbreaks of COVID-19 in many regions.

Although some parts of the world have lifted COVID-19 restrictions and are gradually returning to “normal” life, worries remain in Asia about further waves of infections because vaccine rollouts have been slower than the West in some nations.

In Singapore, further COVID-19 restrictions kicked off in an attempt to curb the virus' spread, as daily new cases have topped the city-state's peak reached in April 2020.

“”Overall, the manufacturing sector may remain resilient as seen from previous phases of restrictions, but the services sector may come under pressure. That said, previous business adjustments and softer tightening compared to past restriction phases may aid to reduce some impact," said Yeap Jun Rong, market strategist at IG in Singapore.

Wall Street closed out a choppy week of trading with a mixed finish for the major stock indexes, though the S&P 500 managed its first weekly gain in three weeks.

The S&P 500 rose 0.1% to 4,455.48 and is now within 1.9% of the all-time high it set Sept. 2. The Dow Jones Industrial Average added 0.1% to 34,798. The Nasdaq slipped less than 0.1% to 15,047.70, while the Russell 2000 dropped 0.5% to 2,248.07.

U.S. markets have had a rough September and investors could be in for more volatility given various concerns, including COVID-19 and its lingering impact on the economy, along with a slow recovery for the employment market.

Worries over troubled Chinese real estate developer Evergrande are still weighing on global markets. Some Chinese banks on Friday disclosed what they are owed by Evergrande, seeking to dispel fears of financial turmoil as it struggles under $310 billion in debt.

In energy trading, U.S. benchmark crude added $1.17 to $75.15 a barrel in electronic trading on the New York Mercantile Exchange. It rose 68 cents to $73.98 per barrel on Friday. Brent crude, the international standard, gained $1.29 to $79.38 a barrel.

In currency trading, the U.S. dollar inched down to 110.69 Japanese yen from 110.71 yen. The euro cost $1.1724, up from $1.1722.