SYDNEY (Reuters) – Asian stocks hovered close to record highs on Monday, while oil exceeded $ 60 a barrel, in the hope that a $ 1.9 trillion COVID-19 aid package will be approved by US lawmakers. USA this month, while coronavirus vaccines are being launched globally.
In a sign that the European and US markets would start strong, eurostoxx futures and Germany’s DAX rose 0.7% each, while London’s FTSE futures rose 0.6%. E-mini futures for the S&P 500 rose 0.4% at the start of the Asian trading session.
The mood was optimistic in Asia, with all major indices recording gains.
The broader MSCI index for Asia-Pacific stocks outside Japan rose 0.5% to 721.11, not far from a 730.16 high reached at the end of last month.
Japan’s Nikkei jumped about 2%, while Australia’s shares were up 0.6%. Chinese stocks advanced with the first-rate CSI300 index up 1.3%.
Hopes for a faster economic revival and restrictions on supply by the OPEC producer group and its allies have brought oil to its highest level in a year, exceeding $ 60 a barrel. [O/R]
Global stock markets have reached record levels in the past few days, hoping for a faster economic recovery, led by successful vaccine launches and expectations of a major pandemic relief package in the U.S.
On Friday, the Nasdaq and S&P 500 set historical records with stronger-than-expected corporate results in the fourth quarter, and companies were on track to report first-quarter profit growth rather than decline. [.N]
The hikes occurred even when US data painted a bleak picture of the country’s labor market, with payroll rising by 49,000, half of what economists expected.
The weak report spurred pressure for more stimuli, underscoring the need for lawmakers to act on President Joe Biden’s $ 1.9 trillion COVID-19 aid package.
Biden and his Democratic allies in Congress moved forward with their stimulus plan on Friday, when lawmakers approved a draft budget that will allow them to move forward in the coming weeks without Republican support.
US Treasury Secretary Janet Yallen predicted that the United States would achieve full employment next year if Congress approved its support package.
“This is a big bet, given that total employment is 4.1%, but that it will fall well in the market at a time when the vaccination program is being implemented efficiently in several countries,” said Chris Weston, strategist Melbourne Chief of Pepperstone.
Expectations of a US economic recovery have not boosted the dollar, “because this shift in the outlook is seen by the market as part of a global recovery,” wrote Westpac economists in a note.
“Investors, therefore, favor risk-taking and, therefore, place less value on the security of the US dollar.”
In fact, the US dollar came out of a four-month high against the Japanese yen, ending at 105.50.
The euro got a little weaker at $ 1.2036, after rising 0.7% on Friday, to a week-high.
The risk-sensitive Australian dollar fell from a week-high to $ 0.7675.
In commodities, Brent oil and American oil rose 59 cents each, to $ 59.93 and $ 0.57.44, respectively.
US gold futures were up 0.1% at $ 1,815.4 an ounce.
Editing by Shri Navaratnam and Jacqueline Wong