Global stocks follow Wall Street higher on vaccine hopes

BEIJING (AP) — Global stock markets and Wall Street futures rose yesterday as hopes for development of a coronavirus vaccine competed with concerns about rising United States (US) infections.

London and Frankfurt opened higher. Shanghai, Tokyo, Hong Kong and Australia also advanced.

Investors were encouraged after Pfizer and BioNtech announced preliminary data from a vaccine test, one of a series being carried out by global developers.

At the same time, the populous American states of California and Texas reported daily record highs in new cases.

“Vaccine hopes, while welcome, fall short of guaranteeing a V-shaped recovery,” Mizuho Bank said in a report.

In early trading, the FTSE 100 in London rose 0.9 per cent to 6,213.01 and Frankfurt’s DAX gained 1.8 per cent to 12,486.31. The CAC 40 in Paris advanced 1.4 per cent to 4,998.16.

A currency trader passes by screens showing Korea Composite Stock Price Index (KOSPI) and foreign exchange rate at the foreign exchange dealing room of the KEB Hana Bank headquarters in Seoul, South Korea. PHOTO: AP

On Wall Street, the future for the benchmark Standard & Poor’s 500 index was up 0.7 per cent and that for the Dow Jones Industrial Average was up one per cent.

On Wednesday, the S&P 500 rose 0.5 per cent, boosted by gains for technology companies. The Dow lost 0.3 per cent while the Nasdaq composite climbed one per cent.

In Asia, the Shanghai Composite Index rose 2.1 per cent to 3,090.57 and the Nikkei 225 in Tokyo added 0.1 per cent to 22,145.96. The Hang Seng in Hong Kong gained 2.8 per cent to 25,124.19.

Seoul’s Kospi advanced 1.4 per cent to 2,135.37 while the S&P-ASX 200 in Sydney gained 1.7 per cent to 6,032.70. India’s Sensex added 1.6 per cent to 35,966.50. New Zealand, Singapore and Jakarta also rose.

Stock markets around the world roared back last quarter on hopes economies are pulling out of their deepest slump since the 1930s.

Analysts warned that prices might be rising too far and too fast to be supported by economic activity when infections are rising in the US, Brazil and some other countries.

In the US, a report on manufacturing showed activity returned to growth in June, a much better reading than the contraction economists expected.

Earlier, a separate report suggested private employers hired more workers than they cut in June.

“It is still a guessing game as to how the COVID-19 lingering impact will sustain,” Jingyi Pan of IG said in a report.

In China, two surveys this week showed manufacturing improved in June, adding to signs of a gradual recovery.

A similar survey for the 19-country eurozone showed manufacturing almost growing again after widespread shutdowns.

Analysts said while the data pointed in the right direction, they show that an economic recovery from the pandemic will be slow.

In energy markets, benchmark US crude gained 34 cents to USD40.16 per barrel in electronic trading on the New York Mercantile Exchange.

The contract rose 55 cents to settle at USD39.82 on Wednesday. Brent crude, the international price standard, gained 36 cents to USD42.39 per barrel in London. The contract rose 76 cents the previous session to USD42.03 a barrel.

The dollar declined to JPY107.36 from Wednesday’s JPY107.49. The euro rose to USD1.1301 from USD1.1244.