U.S. futures have climbed with Asian equities amid expectations that President-elect Joe Biden has a clearer way to bolster fiscal stimulus after major elections. Treasury has suffered losses due to concerns about a rising debt burden and the risk of faster inflation.
A Asia-Pacific company stock was on track for another record on Thursday, while S&P 500 and Nasdaq 100 futures also advanced. The Democrats’ victory in two major Georgia installments gives them control of the U.S. Senate and rekindles the so-called reflection trade that is once again investing in a global recovery from the pandemic.
Earlier, the S&P 500 dropped an advance of as much as 1.5%, but still closed in the green after protesters stormed the US capital. Calm was later restored. Elsewhere, the dollar has been ticking higher. Oil rose and gold changed little.
Hong Kong has missed the protest in Asia, and it is being hit by declines in Alibaba Group Holding Ltd. and Tencent Holdings Ltd., after reports that the Trump administration could hamper investment in China’s two most valuable companies. The New York Stock Exchange’s plan to delist three major Chinese telecommunications companies has also dampened sentiment.
Investors focused on the policy implications of Democrats’ control of the U.S. Senate as lawmakers resumed the politically charged process of ratifying Biden’s victory in the presidential election. Hours earlier, a pro-Trump mob stormed the U.S. Capitol and expelled lawmakers from their rooms.
Asian stock markets have apparently looked beyond the turmoil and chosen to ‘focus on the prospect of more stimulus due to the outcome in Georgia’, says Shane Oliver, head of investment strategy and chief economist at AMP Capital.
In the latest minutes released on Wednesday, the Federal Committee on Public Markets issued guidelines to continue buying bonds at least at the current pace until the economic recovery has made significant further progress.
Meanwhile, the shares of Twitter Inc. after-hours trading dropped after the platform suspended President Donald Trump’s account for a violent mob that stormed the Capitol building.
These are some of the key movements in markets:
Stocks
- S&P 500 futures have risen 0.7% in London since 06:50. The S&P 500 rose 0.6%.
- Japan’s Topix index rose 1.7%.
- Australia’s S & P / ASX 200 index rose 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%.
- Euro Stoxx 50 futures rose 0.3%.
Currencies
- The yen was at 103.21 per dollar, down 0.2%.
- The foreign yuan is trading at 6.4393 per dollar.
- The Bloomberg Dollar Spot Index climbed less than 0.1%.
- The euro was at $ 1.2322.
Effects
- The yield on 10-year treasury rose one basis point to 1.05% after rising eight basis points.
- Australia’s 10-year bond yield rose two points to 1.09%.
Commodities
- West Texas Intermediate crude rose 0.9% to $ 51.09 a barrel.
- Gold rose 0.3% to $ 1,925.27 per ounce.
– With the help of Rita Nazareth, Vildana Hajric and Joanna Ossinger