SYDNEY (Reuters) – Asian stocks rose on Monday as concerns about rising COVID-19 cases and delays in vaccine stocks were accelerated by expectations of a $ 1.9 billion fiscal stimulus plan to revive the U.S. economy.
The global stock markets have scaled a record high on betting over the past few days. COVID vaccines will begin to lower the inflection figures worldwide and with a stronger US economic recovery under President Joe Biden.
Yet investors are also wary of large-scale valuations 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 broadest Asia-Pacific equities index outside Japan rose slightly to 721.96 and just a little further than the record high of 727.31 last week.
The benchmark has risen 8.5% so far in January, on track for its fourth monthly rise.
Japan’s Nikkei fell from early trading declines to 0.36%.
Australian shares were also slightly higher after the country’s drug regulator approved the Pfizer / BioNTech COVID-19 vaccine with the authorities and said a phase start would start at the end of next month.
Chinese stocks rose by the blue-chip CSI300 index by 0.6%.
“The spotlight will be on Washington DC this week,” said Stephen Innes, Axi’s chief global market strategist.
The Biden government has tried to ward off Republicans’ concern that their $ 1.9 billion proposal for a pandemic was too expensive, while lawmakers from both parties said they had agreed to get the COVID-19 vaccine for Americans .
Financial markets have been watching a major economic stimulus in the US, though differences of opinion have meant months of indecision in a country suffering more than 175,000 COVID-19 cases a day, with millions unemployed.
“Vaccine breakthroughs are likely to make life more functional again at some point in 2021, leading to higher GDP growth and more robust corporate earnings,” Innes said.
“But increasing global COVID19 infections, new variants of the virus, the tightening of social distance constraints and delays in the deployment of vaccines in some places, all increase the short-term growth risks.”
Global COVID-19 cases killed about 100 million more than 2 million.
Hong Kong closed an area of the Kowloon Peninsula on Saturday, the first measure to hit the city since the pandemic began.
Reports of the new UK COVID variant were not only very contagious, but perhaps more deadly than the original tension also contributed to the concerns.
In the European Union, political leaders have expressed great dismay over the battle between AstraZeneca and Pfizer Inc. in delivering promised doses, with the Italian prime minister addressing the vaccine suppliers, saying delays are a 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 three major U.S. indices closed higher for the week, with the Nasdaq up more than 4%.
Jefferies analysts said U.S. stock markets appear to be overvalued, although they remain strong.
“To really get the stock market down, rather than just making a bull market correction, there needs to be a catalyst,” said analyst Christopher Wood.
“This means an economic downturn or a significant tightening of Fed policy,” Wood said, noting that none of them would happen in a hurry.
In currencies, major pairs were trapped in a short series as markets waited for a U.S. Federal Reserve on Wednesday.
The dollar index was low at 90.19, with the euro at $ 1.2169, while the British dollar last traded at $ 1.3691.
The Japanese yen was unchanged at 103.77 per dollar.
In commodities, oil prices fell with 12 cents lower at $ 55.29 a barrel and US crude oil down 3 cents at $ 52.24.
Gold was higher with spot prices up 0.2% at 1,855.9 per ounce.
Edited by Sam Holmes & Shri Navaratnam