Asian shares decline despite hopes for economic relief

TOKYO (AP) — Stocks dropped in Asia on Wednesday despite gains on Wall Street on hopes the Trump administration will act to cushion the economic pain of the virus outbreak.

Japan's benchmark Nikkei 225 lost 2.2% to 19,427.38. Australia's S&P/ASX 200 plunged 3.6% to 5,725.90. South Korea's Kospi shed 2.9% to 1,905.50. Chinese shares erased morning gains. Hong Kong's Hang Seng fell 0.6% to 25,238.08, while the Shanghai Composite dipped 0.5% to 2,980.50.

“After the strong rebound yesterday, Asian markets were quite flat this morning. There is consistent fear about the spread of the coronavirus in the U.S. as well as in Europe,” said Louis Wong of Philip Capital Management. He added that “investors are still worried that those fiscal stimulus packages may not be able to contain the virus outbreak as well as to mitigate the impact on the economy.”

Countries are shifting into damage-control mode as infections spread, prompting sweeping controls on travel and other public activities.

In Japan, a task force set up by the prime minister approved a 430 billion yen ($4.1 billion) package Tuesday with support for small to medium-sized businesses. Other governments in Asia have announced billions of dollars' worth of stimulus and other measures to help protect their own struggling economies.

Australia's government announced a $1.6 billion virus-fighting package on Wednesday and reportedly plans an additional $6.5 billion in economic stimulus to be proposed on Thursday.

On Wall Street, the day's moves were a microcosm of the severe swings that have dominated recent weeks. Market watchers say investors want to see a big, coordinated response from governments and central banks to shore up the virus-weakened economy.

The S&P 500 surged as much as 3.7% in the...