· Vaccine focus drives Asian stocks to record highs
Asian equities hit a record high on Monday as investors set aside fears about rising coronavirus cases and bought stocks, cheered by data showing a robust recovery in China and Japan.
MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS gained 1.1% to hit its highest since its launch in 1987, with markets across the region making milestone peaks.
Japan's Nikkei .N225 rose 2% to a 29-year high. South Korea's Kospi .KS11 hit its highest since early 2018 and Australia's ASX 200 .AXJO hit an eight-month top, before jamming there when a glitch halted trade. [.T][.KS][.AX]
S&P 500 futures ESc1 rose 0.9%, Nasdaq 100 futures NQc1 leapt 1% and European futures were up strongly with EuroSTOXX 50 futures STXEc1 up 0.9% and FTSE futures FFIC1 up 0.6% late in the Asia session.
Japanese economic growth, which beat records and forecasts to pull the world’s third-largest economy out of recession and better-than-expected industrial output in China added to the enthusiastic mood.
“Rising COVID-19 cases are a risk, but keep the faith,” Morgan Stanley strategists said in their 2021 outlook note.
“We think this global recovery is sustainable, synchronous and supported by policy, following much of the ‘normal’ post-recession playbook. Overweight equities and credit against cash and government bonds, and sell dollars.”
· China stocks end higher on upbeat data, trade bloc
China stocks ended higher on Monday after upbeat data pointed to a continued recovery in the world's second-largest economy, with the establishment of a China-backed trade bloc aiding sentiment.
The blue-chip CSI300 index rose 1.0%, to 4,904.17, while the Shanghai Composite Index gained 1.1% to 3,346.97 points.
China's factory output rose faster-than-expected in October and retail sales continued to recover although at a slower-than-forecast pace.
Property investment was a key driver of broader spending, with October real estate investment up 12.7% from a year earlier, the fastest pace since July 2018 and quickening from 12% seen in September, according to Reuters calculations based on NBS data.
Investors also welcomed the establishment of a China-backed trade bloc that excludes the United States.
· European markets open higher as U.S. election, coronavirus remain in focus
European stocks opened higher Monday as the fallout of the U.S. election in early November and the coronavirus pandemic remain in focus for global markets.
The pan-European Stoxx 600 climbed 0.7% at the start of trading, with banks adding 2.3% to lead gains as all sectors and major bourses entered positive territory.
The U.S. election result remains a key concern for investors. On Sunday, President Donald Trump acknowledged publicly for the first time that President-elect Joe Biden won the election, more than seven days after media outlets including NBC News called the race for Biden. In subsequent tweets, however, Trump wrote that he would not concede.
The coronavirus pandemic remains a key concern for markets. More than 11 million Covid-19 infections have been confirmed in the U.S., according to data from Johns Hopkins University. Data from the COVID Tracking Project also showed that a record of more than 68,500 people in the U.S. are hospitalized with the coronavirus.
A study by the National Cancer Institute (INT) of the Italian city of Milan showed that the coronavirus was circulating in Italy since September 2019, signaling that Covid-19 might have spread beyond China earlier than previously thought, Reuters reported this weekend.
Reference: Reuters, CNBC
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