SYDNEY (Reuters) – Asian stocks resumed gains on Monday as investors bolstered hopes for vaccines to eventually deliver global economic growth, even as a possible tightening of virus rules for Tokyo drew Japanese shares from the 30-year highs.
After a slow start, the MSCI’s broadest Asia-Pacific stock index outside Japan rose 1.2% higher, reaching another all-time high.
South Korea rose 2% to a record, led by the chip and auto sectors, while Chinese chips added 0.3%.
The E-Mini futures for the S&P 500 were steady after also reaching a record high. EUROSTOXX 50 futures was flat, while FTSE futures rose 0.4%.
Investors continue to rely on central banks to keep their money cheap, while coronavirus vaccines help revive the global economy over time, although much of that optimism is already pricey and the virus continues to spread.
Japan’s Nikkei made early gains, down 0.4% after Prime Minister Yoshihide Suga confirmed that the government was considering a state of emergency for Tokyo and three surrounding prefectures.
Investors are cautiously watching Georgia’s election for two seats in the US Senate on Tuesday, which will determine which party controls the Senate.
If Republicans win one or both, they will retain a weak majority in the House and will be able to block the legislative goals of President-elect Joe Biden and judicial nominations.
“If the Democrats win both races, then-elected Vice President Kamala Harris would have an equal vote, giving the party unified control of the White House and Congress,” CBA analysts noted. “This would increase the likelihood that a material package of US infrastructure spending would be quickly tracked through Congress.”
The minutes of the December meeting of the Federal Reserve, which will take place on Wednesday, should provide more details on the discussions on the explicit increase of their policy guidance and the chance of a further increase in asset purchases this year. .
SALARY A RISK
The data calendar includes a series of manufacturing surveys around the world that will show how the industry is facing the spread of coronavirus and closely monitored ISM surveys of US factories and services.
Chinese plant activity continued to accelerate in December, although the PMI missed forecasts at 53.0.
Japanese production stabilized for the first time in two years in December, while Taiwan grew.
On Friday, the US payroll report for December appears, where the average forecasts are only for a modest increase of 100,000.
Analysts such as Barclays are down 50,000 jobs, which would be a shock to the market’s hopes of a speedy recovery.
“A number of emerging indicators indicate a slower pace as the economy closes the year, including data on labor markets where initial claims rose during the December survey,” economist Michael Gapen said in a note.
Such a drop would add pressure to the Fed to ease even more, another burden for the dollar, which is already leaning under the weight of the massive US budget and trade deficits.
The dollar index was last at 89,704, not far from its last 2-1 / 2 year low of 89,515, after falling by almost 7% in 2020.
The euro returned to 1.2252 USD, after reaching profit at the end of last week, when it reached the highest value since the beginning of 2018, at 1.2309 USD. It gained almost 9% compared to 2020.
The dollar fell to 103.02 yen and seemed in danger of testing key support at 102.55. The pound was confirmed at 1.3690 USD, levels last observed in mid-2018.
In the cryptocurrency space, Bitcoin stood at $ 33,102, after reaching an all-time high of $ 34,800.
The decline in the dollar was a support for gold, leaving the metal 1.3% firmer at $ 1,922 an ounce.
Oil prices widened after several months of solid gains, with Brent testing resistance at around $ 52.50 a barrel. [O/R]
In the long run, crude oil rose 62 cents to $ 52.49, while US crude added 59 cents to $ 49.11 a barrel.
Edited by Jane Wardell, Kenneth Maxwell and Gerry Doyle