Tue, 18 May 2021

Asian equities higher on US recovery hopes

News24
19 Apr 2021, 19:12 GMT+10

  • Asian markets rose on Monday after recovery hopes for the coronavirus-battered US economy fuelled another round of record highs on Wall Street.
  • Both the Dow and S&P finished at new peaks on Friday and also posted their fourth consecutive weekly gains.
  • Hong Kong was up 0.5% and Shanghai rose 1.5% in afternoon trade, despite first-quarter economic growth in China skating under market expectations.

Asian markets rose on Monday after recovery hopes for the coronavirus-battered US economy fuelled another round of record highs on Wall Street to close last week's trade.

Both the Dow and S&P finished at new peaks on Friday and also posted their fourth consecutive weekly gains, following on the heels of strong data for American housing starts, employment and retail sales.

Investors are banking on accelerated US pandemic containment efforts marking a step toward economic normalcy, with half of all adults in the country now having had at least one vaccine dose.

The easing of restrictions in Europe has also boosted optimism even as analysts keep a wary eye on alarming outbreaks prompted by new strains of the virus elsewhere in the world.

"Stocks will kick off the week at record highs, with investors digesting what appears to be an optimistic recovery despite mounting concerns about new Covid-19 variants," said Stephen Innes of Axi.

With less economic data on the calendar in the days ahead and the Fed in a communications blackout ahead of its April 28 rates meeting, "it might be a week for spring housekeeping in the markets", he added.

Hong Kong was up 0.5% and Shanghai rose 1.5% in afternoon trade, despite first-quarter economic growth in China skating under market expectations.

Tokyo finished the day flat after a lacklustre session, with investors searching for new purchase cues.

Market sentiment in Japan has been hamstrung by a slow-moving vaccination programme, though Prime Minister Yoshihide Suga hinted Monday that the country should have enough vaccines for all citizens over 16 by September.

"The market remained cautious as we can't be optimistic about the latest situation of infections at home and overseas," Yoshihiro Okumura of Chibagin Asset Management told AFP.

Mumbai shed more than two percent after officials announced a snap lockdown in India's capital New Delhi.

Indian authorities have been scrambling to free up hospital beds and secure additional supplies of oxygen and treatment drugs after another record daily caseload.

Sydney and Seoul were both flat, Singapore and Taipei were up but both Jakarta and Manila slumped.

London was barely moved shortly after the open while Frankfurt shot up more than 1.3% in morning trade.

'Walls of profit-taking'

Oil benchmarks were down despite energy markets enjoying a boost from industry forecasts and tensions between Washington, Tehran and Russia, Innes said.

"With a softening in the Chinese credit impulse and a resurgence of virus cases in India and Japan, topside ambitions continue to run into walls of profit-taking," he added.

In currency markets, bitcoin dived more than 15% at one point over the weekend after reports that the US Treasury could crack down on digital money laundering, according to NAB analyst Rodrigo Catril.

Bitcoin hit a record high above $62 000 last week ahead of the Wall Street debut of cryptocurrency exchange Coinbase, despite concerns about a bubble and the sustainability of the digital currency market.

Source: News24

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