NEW YORK, Dec. 28 (Reuters) – Asian stocks rallied Tuesday, with Japanese stocks hitting a 29-year high, in the hope that a long-awaited US pandemic relief package would expand and a Brexit trade deal bolster investors’ risk appetite .
Japan’s Nikkei jumped 0.9% to its highest level since March 1991, while Australian stocks were up 0.7% and futures to the S&P 500 added 0.3%.
The US House of Representatives had previously voted to increase stimulus payments to qualified Americans to $ 2,000 from $ 600, sending the measure to the Senate for vote.
While it is not clear how the measure will play out in the Senate, President Donald Trump had sent shares on Wall Street to move from one to the other on Sunday’s signing of a $ 2.3 trillion pandemic bill, including the $ 600 payments. the other day hit record highs because the optimism about recovery.
“With Brexit … and the US stimulus deal now in the rearview mirror, there is a sense of relief that we have avoided the respective worst-case scenarios,” said Stephen Innes, chief global market strategist at Axi, a broker.
Stronger demand for riskier assets kept the US dollar, often viewed as a “safe haven”, in the background. It fell 0.02% against a basket of major currencies.
Going short to the dollar has been a popular trade of late, and calculations by Reuters based on data released by the Commodity Futures Trading Commission on Monday suggested this could continue. Dollar short positions increased to $ 26.6 billion in the week ending December 21, the highest in three months.
The British pound fell to $ 1.3462 as investors continued to take gains in the currency following the confirmation last week of a UK-EU trade deal that was widely expected.
A sluggish dollar supported the gold price, which rose 0.4% to $ 1,878.76 an ounce.
Oil prices rebounded somewhat after falling overnight due to concerns that new travel restrictions due to the COVID-19 pandemic would weaken demand for fuel, and as the prospect of increased supply dragged prices.
US crude oil was up 0.48% to $ 47.85 a barrel.
Reporting by Koh Gui Qing; Editing by Sam Holmes