Asian Stocks Up Over Hopes for More U.S. Stimulus, Peaceful Transfer of Power

Asian Stocks Up Over Hopes for More U.S. Stimulus, Peaceful Transfer of Power

© Reuters.  © Reuters.

By Gina Lee – Asia Pacific stocks were mostly up on Friday morning over rising hopes for more U.S. stimulus measures and a peaceful transfer of power in the U.S. on Jan. 20, when President-elect Joe Biden and his administration are due to be sworn in.

Japan’s Nikkei 225 rose 1.75% by 10:15 PM ET (3:15 AM GMT). After declaring a state of emergency in the greater Tokyo area on Thursday, Prime Minister Yoshihide Suga said earlier in the day that the government would liaise with other prefectures on whether to extend the state of emergency.

South Korea’s KOSPI jumped 2.57%. Korean shares are outperforming over reports than Hyundai Motor Co. (KS:005387) is in early stage talks with Apple Inc. (NASDAQ:AAPL) to develop self-driving electric vehicles. Hyundai shares rose as much as 24% earlier in the session.

In Australia, the ASX 200 was up 0.44%, with the country’s third-largest city of Brisbane entering a three-day lockdown from later in the day.

Hong Kong’s Hang Seng Index gained 1.24%. MSCI Inc. said that it would remove the Hong Kong listed shares of China Mobile (NYSE:CHL) Ltd., China Telecom (NYSE:CHA) Corp. and China Unicom (NYSE:CHU) Hong Kong Ltd from its benchmark indexes at the close of business on Friday. However, confusion as to whether the trio be included in a U.S. ban on investments in Chinese companies with military ties remains, with the New York Stock Exchange revived plans to delist the trio’s U.S. shares.

China’s Shanghai Composite was down 0.47% while the Shenzhen Component edged up 0.20%.

Investors are still digesting the violence wrecked on Capitol Hill by supporters of President Donald Trump, which aimed to disrupt lawmakers’ certification of Biden’s win in the Nov. 3 presidential election. The certification was eventually completed, and alongside Jon Ossoff and Raphael Warnock’s victory in the U.S. Senate runoff elections in Georgia earlier in the week, clears the way for Biden’s agenda to be implemented once he and his administration take office.

Meanwhile, Trump said on Thursday, “A new administration will be inaugurated on Jan. 20th … my focus now turns to ensuring a smooth, orderly and seamless transition of power.”

However, House of Representatives Speaker Nancy Pelosi and Senate Democratic leader Chuck Schumer are leading calls for Trump to be immediately removed from office, threatening a new drive to impeach him if there is no action form his cabinet. A growing number of Trump’s top officials, including Transportation Secretary Elaine Chao, have tendered their resignations.

However, some investors remained optimistic despite the drama in Washington D.C.

“Markets, rightly, in our view, see the U.S. government as ultimately a stable-enough set of institutions even if things occasionally go pear-shaped,” DataTrek Research co-founder Nick Colas said in a note.

“Politics play second fiddle to economic and corporate fundamentals when it comes to setting asset prices. The country’s economic future coming out of the pandemic remains promising," the note added.

Data released on Thursday showed that December’s ISM Non-Manufacturing Purchasing Managers Index was 57.2, higher than the 54.6 in forecasts prepared by and November’s 55.9 reading. Although gains in business activity and new orders helped offset the decrease in the number of initial jobless claims for the week, the U.S. jobs report, including non-farm payrolls, is forecast to show a sharp slowdown in hiring when it is released later in the day.

Original Article

Leave a comment

Send a Comment

Your email address will not be published.

Enter text shown below: