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GLOBAL MARKETS-Asian shares hit new peaks, oil up on Middle East tensions

Published 15/02/2021, 05:33 pm
© Reuters.
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(Adds European futures, updates levels throughout)

* Asian stock markets : https://tmsnrt.rs/2zpUAr4

* MSCI Asia ex-Japan hits record high, Nikkei climbs

* Oil prices at highest since January 2020

* Risk appetite higher on virus vaccine rollout, U.S. stimulus

* Currency market action muted; Bitcoin comes off record highs

By Swati Pandey

SYDNEY, Feb 15 (Reuters) - Asian shares advanced to record highs on Monday as successful coronavirus vaccine rollouts globally raise hopes of a rapid economic recovery amid new fiscal aid from Washington, while oil prices rose on heightened tensions in the Middle East.

The signals for Europe and the United States were positive too, with futures for eurostoxx 50 STXEc1 up 0.5%, those for Germany's DAX FDXc1 rising 0.7% and London's FTSE futures FFIc1 climbing 0.8%.

E-mini futures for the S&P 500 ESc1 were up 0.5%, though U.S. stock markets will be closed on Monday for the Presidents Day holiday.

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS jumped 0.6% to 738.23, with all major indexes in the green.

Japan's Nikkei .N225 climbed 1.9%, reclaiming the 30,000 point level for the first time in over three decades despite data showing the country's recovery from its worst postwar recession slowed in the fourth quarter. benchmark index .AXJO added 0.9%.

China and Hong Kong markets are shut for the Lunar New Year holiday.

The highlight of the week will probably be minutes of the U.S. Federal Reserve's January meeting, where policymakers decided to leave rates unchanged.

Data on inflation is due from the UK, Canada and Japan, while Friday will see major economies including the United States release the preliminary February purchasing managers' indexes (PMI).

While economists expect inflation to stay benign for some while yet, the so-called "reflation trade" has gathered steam in recent days largely led by coronavirus vaccines and hopes of massive fiscal spending under U.S. President Joe Biden.

Biden pushed for the first major legislative achievement of his term, turning to a bipartisan group of local officials for help on his $1.9 trillion coronavirus relief plan. our view, as long as the rise (in inflation) is gradual, equity markets can continue to do well. However, unruly moves would certainly hurt investor sentiment," said Esty Dwek, head of global market strategy, Natixis Investment Managers Solutions.

"Credit spreads have tightened sharply already, but they still have room to absorb some higher yields, making us more comfortable with credit risk than interest rate risk," Dwek added.

"Commodities would be beneficiaries of an inflationary cycle, but they can still continue to recover without high core inflation as economies reopen and demand picks up."

Oil prices climbed to the highest since January 2020 on hopes U.S. stimulus will boost the economy and fuel demand.

Prices were also buoyant after a Saudi-led coalition fighting in Yemen said it intercepted an explosive-laden drone fired by the Iran-aligned Houthi group, raising fears of fresh Middle East tensions. O/R

Brent crude LCOc1 rose $1.2 to $63.66 a barrel. U.S. crude oil CLc1 gained $1.4 to $60.88.

On Friday, the S&P 500 and Nasdaq set record closing highs. The Dow .DJI finished 0.1% higher at 31,458.4 points, the S&P 500 .SPX gained 0.5% to 3,934.83 and the Nasdaq .IXIC added 0.5% to 14,095.47. .N

Action in currencies was muted.

The dollar was slightly higher against the Japanese yen at 105.08 JPY= while the euro rose to $1.2139 and the British pound GBP= was up 0.4% at $1.3894. The risk sensitive Australian and New Zealand dollars climbed 0.3% each. AUD= NZD=

That left the dollar index =USD lower at 90.296.

Bitcoin BTC=BTSP fell more than 3% to $46,992, below a record high of $49,714.66. It posted gains of roughly 20% in a milestone week marked by the endorsement of major firms such as Elon Musk's Tesla TSLA.O .

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https://tmsnrt.rs/2zpUAr4 Asia-Pacific valuations

https://tmsnrt.rs/2Dr2BQA

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