Asia higher on vaccine hopes, stimulus talks
Although Wall Street saw continued profit-taking push equities to a lower close on Friday, the US index futures have recouped much of those losses in Asia this morning. That has lifted equity markets across the region into the green to start the week. The chief drivers were that US fiscal stimulus talks are continuing and hopes that the first Covid-19 vaccines will get rapid FDA approval within the next two weeks.
The S&P 500 e-mini, Nasdaq 100 and Dow Jones futures have all risen by around 0.40% this morning. That has pushed the Nikkei 225 0.40% higher, with the South Korean Kospi leaping 1.80%. The picture is similarly rosy in China, with the Shanghai Composite and CSI 200 climbing 0.90%. However, the Hang Seng is flat as Covid-19 prompts renewed restrictions and the postponement of the Singapore Hong Kong travel bubble.
Singapore has shrugged that news off, climbing 0.70% after Q3 QoQ GDP growth surged by 9.0%. Taiwan, Manila and Jakarta are up 1.0% with Kuala Lumpur lagging, up just 0.15%. Malaysia is weighed down by the risks surrounding the impending budget vote, rising Covid-19 cases. In Australia, resource stocks have led the market higher on the global recovery story. The ASX 200 and All Ordinaries increasing 0.60%.
With sentiment and not data pushing markets higher today, they do remain vulnerable to headline-driven corrections. They are likely to be short-term in nature though, and Europe should happily hitch itself to Asia’s wagon this morning and open higher this afternoon.
In the US October data for Personal Spending and Durable Goods will be released on Wednesday, and are the highlights in a mostly second-tier week. Both of these indicators should show improvements but have come before the surge in Covid-19 cases sparked more movement restrictions across the United States.