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Restrictions return

A wave of new anti-Covid restrictions spreads across Asia. Sinovac's shot is found to be highly effective in a real-world study.  Alibaba wants to show investors the worst is over. Here's what you need to know to start your day.

Restrictions Return

A wave of new restrictions is spreading across Asian countries trying to stamp out small Covid-19 outbreaks after months of containment. Taiwan announced limits on crowds in the first tightening of curbs since the middle of last year. Singapore is also limiting social gatherings and restricting entry of foreign workers, but the World Economic Forum is still planning to hold its annual meeting in the city-state in August. Thailand warned local cases may increase over the next few weeks, and Vietnam's capital city banned large gatherings. Elsewhere, England reported zero deaths in its latest daily update and in the U.S., states are moving quickly to vaccinate teens with Pfizer's Covid-19 shot before the summer.

Weak Start

Asian stocks are set for a weak open after a selloff in U.S. equities, amid ongoing concerns that faster inflation as commodities advance could pose a test for the recovery from the pandemic. Treasury yields climbed. Futures fell in Japan and Australia but earlier rose in Hong Kong. The S&P 500 dropped for a second day following a record high Friday. Dip buyers helped the tech-heavy Nasdaq 100 erase a loss of almost 2% to finish little changed. Treasury yields rose and the dollar traded near the lowest levels of this year. 

Covid Wipeout

Sinovac's vaccine is wiping out Covid-19 among health workers in Indonesia, an encouraging sign for the dozens of developing countries reliant on the controversial Chinese shot, which performed far worse than western vaccines in clinical trials. Indonesia tracked 25,374 health workers in capital city Jakarta for 28 days after they received their second dose and found that the vaccine protected 100% of them from death and 96% from hospitalization as soon as seven days after, said Health Minister Budi Gunadi Sadikin. He also said that 94% of the workers had been protected against infection — an extraordinary result that goes beyond what was measured in numerous clinical trials — though it's unclear if the workers were uniformly screened to detect asymptomatic carriers.

Big Spenders

Australia unveiled a big-spending budget that aims to drive unemployment down to levels rarely seen in the past 50 years. The budget deficit in the 12 months through June 2022 is wider than expected at 5% of GDP, but with an election due by May next year it leaves the opposition Labor party struggling for a narrative when the conservative incumbent is spending so freely. Following his bungled responses to sexism and rape allegations, Prime Minister Scott Morrison sought to regain lost ground with Australian women with a A$3.4 billion Women's Budget Statement. Older people and craft brewers are among the other budget winners and losers.

Jerusalem Unrest

Violence between Israel and Gaza is edging closer to all-out war. Israel stepped up its attacks on the Hamas-ruled Gaza Strip on Tuesday after Gaza militants began firing hundreds of rockets at southern Israel on Monday evening. More than two dozen militants and civilians have died in Gaza and three civilians in Israel in a sharply intensified spillover from weeks of clashes between Israeli security forces and Palestinians in contested Jerusalem. The escalation has set off a flurry of diplomatic efforts involving Egypt, the U.S. and United Nations.

What We've Been Reading

This is what's caught our eye over the past 24 hours:

And finally, here's what Tracy's interested in today

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You can follow Tracy Alloway on Twitter at @tracyalloway.

 

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