By Adam Claringbull
Investing.com – Asian stocks were mostly up on Friday morning, tracking with U.S. markets and the news that Democrats and Republicans were continuing to try and iron out a COVID-19 stimulus deal. China’s markets also came back on stream after the Golden Week national holidays.
Hopes for a U.S. coronavirus stimulus package were raised yet again, with President Trump making a U-turn on his Tuesday decision to cancel talks on a deal. Democrat House of Representatives Speaker Nancy Pelosi and Republican Treasury Secretary Steven Mnuchin are continuing efforts to reach a consensus, though the two sides are still far apart in their conceptions of the shape of the package.
Markets are also starting to factor in the possibility of a Democrat clean sweep in the upcoming U.S. elections, with recent polling suggesting that both President Trump and his Republican Party will lose both the presidency and control of the Senate. Should the Democrats control both houses of government and the presidency, a much larger stimulus package is expected, though not until the transference of power is complete.
“Biden seems to have a clear lead following the TV debate and a coronavirus cluster in the White House, which has raised questions about Trump’s crisis management capabilities,” Mutsumi Kagawa, chief global strategist at Rakuten Securities, told Reuters.
China’s markets reopened today after the Golden Week holidays and quickly made up for lost time, with both the Shanghai and Shenzhen bourses seeing rapid rises as investors looked to catch up with events. China’s Caixin Services rose to 54.8 in September, against August's reading of 54.
The Shanghai Composite rose 1.89% at 12:05 AM ET (4:05 AM GMT) and the Shenzhen Composite jumped 3.21%.
Japan’s Nikkei 225 was down 0.39% and South Korea’s KOSPI was up 0.21%.
In Australia, the ASX 200 inched up 0.02%. Hong Kong’s HHang Seng inched down 0.09%.
U.S. jobless claims data came in higher than expected, suggesting that the world’s largest economy has quite some way to go yet before a recovery is on the cards. 840,000 Americans applied for unemployment claims during the past week against the forecast 820,000 claims, although the number was down from the previous week's 849,000 claims.
In the meantime, global COVID-19 cases hit a record one-day increase on Thursday, according to the World Health Organization, with Europe particularly affected. The U.S. also recorded a rise in cases in some 30 states.