Asia-Pacific stocks fell on Friday as the emergence of a new coronavirus variant in South Africa spooked investors.
The variant may be able to evade immune responses and has prompted Britain to introduce travel restrictions on South Africa. The World Health Organization will hold a special meeting on the new variant today.
Benchmark Nikkei 225 index reached a seven-week low, down 3% to 28,628.18 at midday. The broader TOPIX index also hit a seven-week low as it dropped 2.4% to 1,977.73.
New variant also in Hong Kong
The new coronavirus variant was also detected in Hong Kong, dragging the Hang Seng index to an eight-week low. The index was down 2.1% at 24,213.55 at midday.
The embattled property developer Evergrande plunged 7.5%, while peer Fantasia declined 4.4%.
Shanghai index slid 0.5% 3,566.18, while South Korea’s KOSPI hit a seven-week low. KOSPI plunged 1.2% to 2,944.94, with Samsung Electronics shedding 2% and SK Hynix falling 1.7%.
Aussie stock in third weekly loss
The negative sentiment also weighed on Australian stocks, with the S&P/ASX200 index down 1.7% at 7,281.40.
The main difference between CFD trading and trading assets, such as commodities and stocks, is that you don’t own the underlying asset when you trade on a CFD.
You can still benefit if the market moves in your favour, or make a loss if it moves against you. However, with traditional trading you enter a contract to exchange the legal ownership of the individual shares or the commodities for money, and you own this until you sell it again.
CFDs are leveraged products, which means that you only need to deposit a percentage of the full value of the CFD trade in order to open a position. But with traditional trading, you buy the assets for the full amount. In the UK, there is no stamp duty on CFD trading, but there is when you buy stocks, for example.
CFDs attract overnight costs to hold the trades (unless you use 1-1 leverage), which makes them more suited to short-term trading opportunities. Stocks and commodities are more normally bought and held for longer. You might also pay a broker commission or fees when buying and selling assets direct and you’d need somewhere to store them safely.