* Asian stocks returned from 3-month lows
* Economic optimism thwarted by concerns about tensions between China and the US
* The euro / dollar is the lowest since November in terms of divergent health prospects
* European shares increased by 0.6-0.8%
TOKYO, March 26 (Reuters) – Global equities returned to a three-month low on Friday, as investors focused more on optimism about the global economic recovery than on rising tensions between the West and China.
European stocks appear to be opening up more, with Euro Stoxx futures rising 0.8% and British FTSE futures gaining 0.61%.
The former MSCI Asia Index rose 1.43% after hitting a three-month low on Thursday, as the Shanghai Composite Index gained 1.53%, recording a three-day loss.
On Thursday, Chinese stocks fell to a three-month low at the beginning of the month. The European Union joined Washington’s allies last week in imposing sanctions on officials in China’s Xinjiang region on charges of human rights abuses, leading to sanctions in retaliation in Beijing.
“All the sanctions so far have been largely symbolic and should have little economic impact. But the Sino-US confrontation affects market sentiment. It could take some time for them to reach any compromise, “said Yasutada Suzuki, head of emerging market investments at Sumitomo Mitsui Bank.
The Japanese Nikkei rose 1.47% after Wall Street staged a rally, driven by cheap, cyclical stocks that were hit by the pandemic.
The Dow Jones industrial average rose 0.62% and the S&P 500 gained 0.52%, while the Nasdaq Composite added just 0.12%.
“It’s the end of the month, the end of the quarter and for Japanese players, at the end of the financial year, so we see random flows from all kinds of players,” said Masanari Takada, an asset cross strategist at Nomura Securities.
“But overall, those who led the trade based on their positive view of the Chinese economy are now closing their positions, while those who failed to go on that wave are looking to see if they should buy on the dive.”
While markets were driven more by various end-of-quarter transactions than by the news flow, analysts noted that overnight headlines largely supported equities.
Data from the US Department of Labor showed that claims for unemployment benefits fell to a one-year low last week, a sign that the US economy is on the verge of growing stronger as the public health situation improves.
In his first official press conference, US President Joe Biden said he would double his administration’s vaccination launch plan after reaching the previous target of 100 million photos 42 days ahead of schedule.
But while improving the US health crisis has sustained global risk appetite, investors are increasingly alarmed by a divergence in health conditions.
“Vaccination in continental Europe is falling behind. In relation to the USA, the economic reopening will probably be delayed, because some countries are forced to impose blockades “, said Soichiro Matsumoto, investment director, Japan, at the private banking unit of Credit Suisse in Tokyo.
This put pressure on the euro, which licked its wounds to $ 1.1782 after falling above $ 1.1762 overnight, its lowest levels since November.
The dollar also rose to 109.21 yen, a striking distance from last week’s nine-month high of 109,365 yen.
The US index was near its highest level since mid-November, after gaining 2.0% so far this month.
Oil prices recovered slightly from a 4% drop on Thursday, although they are on track for the third consecutive week of losses due to concerns about a further reduction in demand.
In addition to Europe, major developing economies, such as Brazil and India, are also struggling with a resurgence of COVID-19 cases.
The market has attracted some more support due to supply disruptions, as a container ship stranded in the Suez Canal could block the vital shipping lane for weeks.
American crude oil rose last time by 1.33% to $ 59.35 a barrel, and Brent to $ 62.62, up 1.08%.
Additional reporting by Katanga Johnson in Washington; edited by Richard Pullin, Ana Nicolaci da Costa and Lincoln Feast.