Global shares rise on hopes Biden will act on economy, virus

TOKYO (AP) — Global shares were mostly higher ahead of Joe Biden’s inauguration as United States (US) president yesterday, though worries about surging coronavirus cases sapped the Japanese market’s early gains.

France’s CAC 40 added 0.2 per cent to 5,607.84 in early trading, while Germany’s DAX rose 0.2 per cent to 13,848.56. Britain’s FTSE 100 edged up 0.1 per cent to 6,722.42. US shares were set to drift moderately higher as Dow futures inched up less than 0.1 per cent to 30,841.0. S&P 500 futures were up 0.3 per cent at 3,800.12.

Japan’s benchmark Nikkei 225 slipped 0.4 per cent to finish at 28,523.26. Australia’s S&P/ASX 200 added 0.4 per cent to 6,770.40, while South Korea’s Kospi edged up 0.7 per cent to 3,114.55. Hong Kong’s Hang Seng jumped 1.1 per cent to 29,962.47, while the Shanghai Composite rose 0.5 per cent to 3,583.09.

Hopes are growing that Biden’s planned stimulus for the American economy as well as measures to curb the pandemic will boost regional markets.

While many Asian nations have fared better in the pandemic than European countries and the US, worries still run high. Main urban areas in Japan, including Tokyo, are under a state of emergency, with evening dining at restaurants discouraged. Critics said that’s not enough, as deaths related to COVID-19 have been rising. A vaccine rollout has not begun in Japan.

People are reflected on the electronic board of a securities firm in Tokyo. PHOTO: AP

“Chinese New Year is less than a month away. With COVID infection numbers already on the rise again in parts of Asia, there are concerns about what the holiday season may mean for efforts to contain the virus’s spread,” said Chief global market strategist at Axi Stephen Innes.

Markets have been rising on enthusiasm about a coming economic recovery as more people are inoculated with COVID-19 vaccines and Washington gets set to try for another round of economic stimulus.

Janet Yellen, Biden’s nominee to be Treasury secretary, told the Senate Finance Committee during her confirmation hearing that the incoming administration would focus on winning quick passage of its USD1.9 trillion pandemic relief plan.

“More must be done,” Yellen said. “Without further action, we risk a longer, more painful recession now — and long-term scarring of the economy later.”

The plan would include USD1,400 cash payments for most Americans. Democrats are also pushing for faster rollout of COVID-19 vaccines, a higher minimum wage for workers and enhanced benefits for laid-off workers. The hope is that such stimulus can carry the economy until later this year, when more widespread vaccinations get life returning to some semblance of normal.

“If most of this is implemented, it does suggest significant pickup in economic growth as we head through to the fourth quarter of this year,” said Chief global strategist at JPMorgan Funds David Kelly.

In energy trading, benchmark US crude added 31 cents to USD53.29 a barrel. Brent crude, the international standard, rose 35 cents to USD56.25.

In currency trading, the US dollar slipped to JPY103.76 from JPY103.99. The euro cost USD1.2134, up from USD1.2115.