Asia leads market gains on outlook for brighter 2021
Global stocks moved higher on Wednesday on hopes for an economic recovery in 2021 from the coronavirus pandemic.
MSCI’s gauge of Asia-Pacific shares, excluding Japan, rose 1.1 per cent, building on record-breaking gains since November to reach an all-time high. China’s CSI 300 index of Shanghai- and Shenzhen-listed shares rose more than 1 per cent to its highest point since 2015 as the EU and China prepared to announce a long-awaited investment treaty. Hong Kong’s Hang Seng climbed 2.2 per cent and South Korea’s Kospi gained 1.9 per cent.
In Europe, the benchmark Stoxx 600 index rose 0.2 per cent in early dealings, while London’s FTSE 100 also gained 0.2 per cent after closing up 1.6 per cent in the previous session. Germany’s Dax continued to hover around the record highs struck earlier this week.
Sterling was up 0.7 per cent against the dollar at $1.3593 — close to its high of the year — on the day UK MPs are set to approve the EU trade deal finalised on Christmas Eve.
US futures indicated that the benchmark S&P 500 index of blue-chip stocks was set to open 0.4 per cent higher later in the day.
The US House of Representatives on Monday voted to increase direct stimulus cheques to Americans from $600 to $2,000, putting pressure on the Republican-controlled Senate to beef up this month’s $900bn economic relief package.
The S&P hit a new all-time high following the vote, but closed lower on Tuesday after the Republican Senate majority leader Mitch McConnell blocked Democrat’s attempts to swiftly implement the payments.
The yield on 10-year Treasuries, which moves inversely to price, ticked up 0.02 percentage points to 0.95 per cent ahead of the bumper sale of long-term government bonds next year.
Meanwhile, the UK government confirmed on Wednesday morning that the country’s medicines regulator had approved the Covid-19 vaccine made by Oxford university and AstraZeneca. The news came shortly after a British woman became the first ever person to receive the second dose of the vaccine made by BioNTech and Pfizer.
The price of oil rose, with Brent crude, the international benchmark, up 0.7 per cent at $51.45 a barrel.
UK natural gas prices rose with demand set to increase with already cold temperatures forecast to dip further over the weekend. The UK day ahead contract was up 1.4 per cent at 57.50p a therm, extending gains since the start of November to 65 per cent.
The increase in gas price this winter also reflects the UK’s reliance on liquefied natural gas imports, which has left it exposed to rallying prices in Asia.