HONG KONG (AFP) – Optimism about the global economic recovery and vaccine rollouts trumped ongoing concerns about soaring virus infections yesterday with most Asian markets clocking up big gains.
Traders were also awaiting the Senate confirmation hearing for United States (US) Treasury secretary pick Janet Yellen, which is expected to give lawmakers a chance to go over Joe Biden’s huge stimulus proposal.
US markets were closed on Monday for a public holiday but regional investors were mostly in buoyant mood as they prepared for the new president to take office promising a vaccination blitz and a drive to kick-start the economy.
Hong Kong piled on more than three per cent at one point, having jumped one per cent on Monday, to levels not seen since May 2019 thanks to an inflow of cash from mainland China.
The Hang Seng later pared the rally.
Seoul put on more than two per cent, while Tokyo, Sydney, Mumbai and Bangkok all rose more than one per cent, while there were smaller gains in Singapore and Wellington.
Shanghai, Manila and Jakarta fell, however.
US futures were in positive territory.
Global coronavirus cases broke 95 million this week while deaths have topped two million, putting pressure on governments to quickly distribute vaccines while at the same time imposing strict, economically painful lockdowns.
While Biden’s inauguration today is the key event for the week, traders will be keeping a close watch on Yellen’s hearing, where the former Federal Reserve chief is expected to tell lawmakers the world’s top economy could suffer if they do not approve a big spending plan.
“Economists don’t always agree, but I think there is a consensus now: Without further action, we risk a longer, more painful recession now – and long-term scarring of the economy later,” she was expected to say, the Wall Street Journal reported.
“Over the next few months, we are going to need more aid to distribute the vaccine; to re-open schools; to help states keep firefighters and teachers on the job.”