US futures were climbing Asian equities expecting President-elect Joe Biden to have a clearer path to boost fiscal stimulus after major elections. Treasuries continued to lose on concerns about rising indebtedness and the risk of accelerating inflation.
A measure of Asia-Pacific stocks was on track to set a new all-time high for Thursday, while futures on the S&P 500 and Nasdaq 100 also advanced. The Democrats’ victory in two major outflows in Georgia puts them in control of the US Senate and has rekindled the so-called reflation trade betting on a global pandemic recovery.
Previously, the S&P 500 saw a whopping 1.5% advance, but still closed in the green after protesters stormed the Capitol. Peace was later restored. Elsewhere, the dollar ticked higher. Oil rose and gold had changed little.
Hong Kong missed the Asia rally, weighed down by declines at Alibaba Group Holding Ltd. and Tencent Holdings Ltd. after reports that the Trump administration could ban investments in China’s two most valuable companies. The New York Stock Exchange’s plan to take three major Chinese telecommunications companies off the stock exchange also detracted from sentiment.
Investors focused on the policy implications of Democrats winning control of the US Senate as lawmakers resumed the politically charged process of ratifying Biden’s presidential election victory. Hours earlier, a pro-Trump mob had stormed the US Capitol, driving lawmakers from their chambers.
Equity markets in Asia appeared to be looking past the turmoil, choosing to “focus on the prospects for more stimulus as a result of the outcome in Georgia,” said Shane Oliver, chief investment strategy and chief economist at AMP Capital.
In the latest minutes released Wednesday, the Federal Open Market Committee issued guidelines that it would continue bond purchases at least at the current pace until the economic recovery had made “substantial further progress.”
Meanwhile, Twitter Inc.’s shares fell. in off-hours trading after the platform suspended President Donald Trump’s account for inciting a violent mob storming the Capitol.
These are some of the main movements in markets:
Shares
- S&P 500 futures were up 0.7% from 6:50 am in London. The S&P 500 gained 0.6%.
- The Japanese Topix index climbed 1.7%.
- The Australian S & P / ASX 200 index climbed 1.6%.
- South Korea’s Kospi index rose 2.1%.
- Hong Kong’s Hang Seng index fell 0.5%.
- The Shanghai Composite Index added 0.2%.
- Futures on Euro Stoxx 50 rose 0.3%.
Currencies
- The yen was at 103.21 per dollar, down 0.2%.
- The offshore yuan traded at 6.4393 per dollar.
- The Bloomberg Dollar Spot Index climbed less than 0.1%.
- The euro was $ 1,2322.
Bonds
- Ten-year government bond yields increased one basis point to 1.05% after an increase of eight basis points.
- Australia’s 10-year bond yield rose two basis points to 1.09%.
Raw materials
- West Texas Intermediate crude oil climbed 0.9% to $ 51.09 a barrel.
- Gold rose 0.3% to $ 1,925.27 an ounce.
– With the assistance of Rita Nazareth, Vildana Hajric and Joanna Ossinger