Stocks, oil rises in Asia after US records, dollar weakens

(Reuters) – Asian stock markets rose on Tuesday after a record day on Wall Street, while bitcoin stopped to breathe after a nightly endorsement by Tesla Inc raised the cryptocurrency by 20%.

Oil also reached 13-month highs, helped by growing optimism about a return in fuel demand,

However, as a sign that positive sentiment may fade in European trading, eurostoxx futures fell 0.05%, London FTSE futures fell 0.12% and E-mini futures for the S&P 500 were stable.

Back in Asia, the broader MSCI Asia-Pacific stock index outside Japan rose 0.37% to 722.95 after rising to 730.16 last month.

The gains were led by Chinese blue chips, which rose 1.67%, while the Hong Kong benchmark rose 0.51% and Korea’s rose 0.27%, with chip giants benefiting from bitcoin’s excitement.

ING’s chief Greater China economist Iris Pang said the strong performance of Chinese markets was a result of buying investors before the Chinese New Year holiday, anticipating that prices would be higher after the holiday.

Chinese stock exchanges are closed for a week starting on Thursday.

Japan’s Nikkei rose 0.27%.

Tuesday’s gains in Asia corresponded to so-called reflux negotiations around the world, in which global markets increased stocks, oil and gold, while U.S. Treasury yields remained close to 11-month highs.

“Reflection resulting from the US fiscal stimulus and positive vaccine news remains the main topic for markets,” wrote strategists at the National Australia Bank.

Expectations are growing that inflation will rise as governments and central banks continue to spend heavily and with easy money policies until officials are confident that their economies will recover from the coronavirus pandemic.

Wall Street reached its all-time close on Monday, with the Nasdaq Composite moving up almost 1% and the S&P 500 and Dow Jones Industrial Average gaining about 0.75%.

In more volatile cryptocurrency markets, bitcoin surpassed $ 47,000 for the first time, an increase of 20%, before fluctuating just below that level.

Tesla Inc said overnight that it has invested about $ 1.5 billion in virtual currency and hopes to accept it as payment for its cars in the future.

Justin d’Anethan, sales manager for Diginex, a digital assets company, said most of the selling pressure in Asia had been absorbed.

“This morning, after more than $ 1.2 billion in leveraged short positions have been liquidated, the usual crypto sellers are likely to think twice before dumping their coins,” said d’Anethan.

Oil prices continued to rise on Tuesday, reaching their 13-month highs.

Brent rose 45 cents, or 0.74%, US West Texas Intermediate crude was at $ 58.39 a barrel, up 43 cents, also 0.74%.

“There is a feeling that the oversupply of oil is disappearing faster than anyone thought possible,” said Phil Flynn, senior analyst at Price Futures Group in Chicago. “There seems to be a paradigm shift in the market.”

Spot gold rose 0.37% to $ 1,837 an ounce, up for the week, with expectations of a major US economic stimulus package reinforcing its appeal as an inflation hedge.

Those expectations hit the dollar index, which fell further on Tuesday after stumbling late last week in a weaker-than-expected job report. The last drop was 0.25% at 90.728.