Asian stocks are near a peak as US stimulus plans offset virus problems

SYDNEY (Reuters) – Asian stocks rose to near all-time highs on Monday as concerns about rising COVID-19 cases and delays in vaccine delivery were overshadowed by optimism about a plan of $ 1.9 trillion in fiscal stimulus to help revive the U.S. economy.

Sentiment in the region was also fueled by a report that China had overtaken the United States to be the main recipient of foreign direct investment in 2020 with $ 163 billion in revenue.

Futures markets also pointed to firmer starts elsewhere. E-mini futures for the S&P 500 rose 0.37%, eurostoxx 50 and London FTSE futures rose 0.3% each, while those for the German DAX added 0.4%.

“The history of FDI has definitely lifted China and its close neighbors today, causing an economic recovery from the tailwind in geographically adjacent markets,” said Jeffery Halley, a Singapore-based market analyst at OANDA.

“Looking to the future, the shares will find more significant reactions based on whether or not Biden’s stimulus package progresses and the level of balance shown by the Federal Reserve at this week’s FOMC meeting.”

Global equity markets have climbed record highs in recent days in betting COVID-19 vaccines will begin to reduce infection rates worldwide and in a stronger economic recovery in the United States under President Joe Biden.

However, investors are also wary of the imposing ratings amid questions about the effectiveness of vaccines to curb the pandemic and as U.S. lawmakers continue to debate a coronavirus aid package.

MSCI’s broader Asia-Pacific stock index outside of Japan rose to 726.46, at a record low of 727.31 last week.

The benchmark has risen almost 9% so far this January, following its fourth consecutive monthly rise.

The Japanese Nikkei rebounded after the falls in the first operations to increase by 0.7%.

Australian shares rose 0.4% after the country’s drug regulator approved the Pfizer / BioNTech COVID-19 vaccine with a phased implantation likely late next month.

Chinese equities rose, with a blue CSI300 index rising 1.1%. Hong Kong’s Hang Seng index jumped nearly 2%, led by technology stocks.

All eyes are on Washington DC, as U.S. lawmakers agreed that getting the COVID-19 vaccine to Americans should be a priority, even when blocking horns above pack size. ‘relief of the American pandemic.

Financial markets have been observing a massive package, although disagreements have led to months of indecision in a country that suffers from more than 175,000 COVID-19 cases a day with millions out of work.

Global cases of COVID-19 increase to 100 million, with more than 2 million deaths.

Hong Kong closed an area of ​​the Kowloon Peninsula on Saturday, the first step the city has taken since the pandemic began.

According to reports, the new variant of COVID in the UK was not only highly infectious, but perhaps more deadly than the original variety which was also added to the concerns.

In the European Union, political leaders expressed great dismay at the retention of AstraZeneca and Pfizer Inc. in delivering the promised doses, and the Italian prime minister attacked vaccine suppliers, saying the delays amounted to a breach. serious breach of contractual obligations.

On Friday, the Dow fell 0.57%, the S&P 500 lost 0.30% and the Nasdaq added 0.09%. The top three U.S. indices closed higher during the week, with a Nasdaq above 4%.

Jefferies analysts said U.S. stock markets appeared overvalued, although they remained bullish.

“For the stock market to have a really nasty development, rather than a simple bullish market correction, there needs to be a catalyst,” analyst Christopher Wood said.

“This means an economic recession or a material tightening of Fed policy,” Wood said, adding that neither would occur in a hurry.

In currencies, major pairs were trapped in a narrow range as markets awaited Wednesday’s Fed meeting.

The dollar index eased to 90.073, with the euro at $ 1.2181, while the pound sterling was slightly firmer at $ 1.3721.

The Japanese yen was weaker at 103.69 per dollar.

In commodities, Brent gave up the first losses to fall to the last plan at $ 55.41 a barrel and US crude rose 3 cents to $ 52.30.

Gold was flat at $ 1,852.9 an ounce.