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GLOBAL MARKETS-Asian stocks extend gains as vaccine hopes support global reopening

Published 11/11/2020, 11:34 am
Updated 11/11/2020, 11:36 am
© Reuters.
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By Lawrence Delevingne

BOSTON, Nov 10 (Reuters) - Asian shares rose on Wednesday as hopes for a successful coronavirus vaccine lifted expectations of a swift reopening of the global economy, which would help the region's heavily trade-dependent markets.

Australia's benchmark S&P/ASX 200 .AXJO climbed 1.05% with energy stocks and miners boosted by higher crude and commodity prices.

New Zealand's benchmark S&P/NZX 50 index .NZ50 rose around 0.6% in early trade ahead of the country's central bank meeting. Nikkei 225 .N225 added 1.1%, and Hong Kong's Hang Seng index futures .HIS HSIc1 rose 0.09%.

"Investors anticipate a lift in economic activity and a swing back to physical businesses, judging by their support for travel, consumer, financial, materials and energy stocks," Michael McCarthy, chief market strategist for CMC Markets in Sydney, wrote in a note Wednesday.

The gains in Asia came despite the S&P 500 index slipping slightly and the Nasdaq closing sharply lower on Tuesday as vaccine optimism led investors away from market leaders and toward cyclical stocks associated with economic recovery. the same time, there were mixed signals from U.S. government leaders about near-term policies.

President Donald Trump and other top Republican lawmakers continued their refusal to concede the election to President-elect Joe Biden, delaying the transition of power and related policy shifts. Federal Reserve policymakers also said on Tuesday that a surge in coronavirus cases threatens to slow economic growth once more and that more targeted government aid was needed. shouldn't stop government stimulus efforts, according to ANZ Research strategists Liz Kendall and David Croy.

"Policy makers remain vigilant and monetary policy will err towards being very accommodative until a vaccine can be comprehensively rolled out," they wrote on Wednesday.

E-mini futures for the S&P 500 EScv1 were flat.

European shares held near eight-month highs on Tuesday, riding a wave of optimism about a COVID-19 vaccine breakthrough, although concerns about the pandemic's economic damage capped gains. also ended nearly 3% higher on Tuesday as hopes of a COVID-19 vaccine outweighed worries about a drop in fuel demand from new lockdowns to contain the virus. crude CLc1 rose 1.11% to $41.82 per barrel and Brent LCOc1 was at $44.05, up 3.89% on the day.

"The reflation trade continues to work in earnest and the rotation to the unloved areas of the market continues," Chris Weston, Pepperstone's Melbourne-based head of research, wrote in a note Wednesday.

The greenback was steady on Tuesday and the yen stayed near three-weeks lows, as investors remained optimistic about progress toward a vaccine and the currency markets digested Monday's big moves. euro EUR= rose 0.03% to $1.1818, the Japanese yen strengthened 0.04% versus the greenback at 105.26 per dollar, while sterling GBP= last traded at $1.3263, down 0.06% on the day. The Australian dollar fell 0.01% versus the greenback at $0.728.

U.S. Treasury yields rose modestly on Tuesday, as the market consolidated the previous session's strong gains fueled by news of a potential coronavirus vaccine. regained some ground lost in Monday's plunge as expectations of fiscal and monetary stimulus offered support to the safe-haven metal. gold XAU= added 0.1% to $1,878.06 an ounce.

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