Global shares track Wall Street gains, shrug off jobs fears

BANGKOK (AP) — Shares powered ahead in Europe and Asia yesterday after a 3.4 per cent overnight rally on Wall Street.

Benchmarks rose in Paris, London and Hong Kong and ended flat in Tokyo, with investors seemingly reassured by signs that coronavirus deaths and infections may be nearing a peak or plateau in some of the world’s hardest-hit areas.

A meeting of oil producers yesterday has raised hopes energy companies might get some relief in the form of production cuts to help support crude prices.

The optimism helped to temper concern over increasingly gloomy data on unemployment as companies shutter and shed staff in many parts of the world.

The United States (US) government was set to report unemployment claims yesterday, with the number expected to shock even after a record nearly 10 million people applied for benefits in the previous two weeks because of business shutdowns from the coronavirus.

A currency trader watches computer monitors near the screens showing the foreign exchange rates at the foreign exchange dealing room in Seoul, South Korea yesterday. PHOTO: AP

Germany’s DAX advanced 1.3 per cent to 10,470.53 while the CAC 40 in France gained 0.9 per cent to 4,480.73. Britain’s FTSE 100 picked up 1 per cent to 5,733.56. US shares looked set for gains, with the future for the S&P 500 up 0.3 per cent to 2,743.60 and that for the Dow industrials gaining 0.6 per cent to 23, 381.00.

Japan’s Nikkei 225 index was nearly unchanged, ending at 19,345.77, after the central bank governor said the economy faces “extremely high” uncertainty over the likely impact of the pandemic.

That uncertainty was heightened by disagreement between leaders over just how quickly and far to extend precautions meant to contain a surge in coronavirus infections.

The governor of Aichi, home to Toyota Motor Corp’s headquarters and a prefecture not covered by a declared state of emergency for Tokyo and six other areas, has asked that it also be included. The region has reported dozens of police officers falling sick from the coronavirus.

Elsewhere in Asia, markets were mostly higher. Hong Kong’s Hang Seng added 1.4 per cent to 24,300.33 and the Shanghai Composite index gained 0.4 per cent to 2,825.90. In Australia, the S&P/ASX 200 jumped 3.5 per cent to 5,387.30 and South Korea’s Kospi climbed 1.6 per cent to 1,836.21. India’s Sensex surged 3.3 per cent to 30,884.46.

Recent upward swings in markets have dwarfed declines amid signs that deaths and infections may be nearing a peak or plateau in some of the world’s hardest-hit areas.

That’s led some investors to begin looking to the other side of the economic shutdown that is gripping the world as authorities try to slow the spread of the coronavirus. The S&P 500 has jumped nearly 23 per cent in the last two and a half weeks, building on earlier gains driven by massive amounts of aid promised by governments and central banks for the economy and markets.

“Risk assets continued to rally on the perception that the global economy will open up again quicker than expected,” Stephen Innes of AxiCorp said in a commentary.

The prospect for progress in talks among oil producers has also driven gains, he noted.

“The icing on the cake, … a ‘good’ outcome for oil prices from the OPEC+ meeting, would be a global agreement to cut output … beyond OPEC and Russia, although demand concerns will persist,” Innes said.

Oil prices have been even more volatile than stocks recently as Russia and Saudi Arabia bicker over production levels as demand withers.

Benchmark US crude oil rose 89 cents to USD25.98 per barrel in electronic trading on the New York Mercantile Exchange early yesterday. It gained USD1.46, or 6.2 per cent, to settle at USD25.09 a barrel on Wednesday, recovering some of its 9.4 per cent slide from the day before.

Brent crude oil, the international standard, rose 96 cents to USD33.80 per barrel. It gained 97 cents, or three per cent, to USD32.84 a barrel in London.

In currency trading, the dollar fetched JPY108.90, up from JPY108.84 on Wednesday. The euro sold for USD1.0873, strengthening from USD1.0856.

Treasury yields, which have signalled worries about the economic damage from the coronavirus outbreak earlier than the stock market, were relatively steady. The yield on the 10-year Treasury was at 0.75 per cent, from 0.76 per cent late Wednesday.

Nearly 1.5 million cases of COVID-19 have been confirmed around the world, with more than 432,000 of them in the US. More than 88,000 people have died from the virus, while nearly 330,000 have recovered, according to a tally by Johns Hopkins University.