Hong Kong (AFP)
Asian traders took a hiatus on Thursday after the vaccine-fueled markets recovered this month, with profit-takers moving while keeping an eye out for viral infections across the world that are forcing governments to impose confinement.
With at least three vaccinations underway and possibly rolled out in a matter of weeks, the general mood of the prosecution is optimistic for 2021, but a new batch of data from the United States has highlighted the immediate impact of the disease and the long road to go for savings. .
And the notes from the Federal Reserve’s latest policy meeting warned that the country’s recovery would be more difficult without a new stimulus package.
Official figures show jobless claims increased for a second week in a row, as businesses were hit by a surge in new infections and deaths that led several major cities, including New York and Los Angeles, to close bars and restaurants.
The readings gave traders a dose of reality after weeks of fervent shopping in reaction to vaccine successes and Joe Biden’s election victory.
The crisis elsewhere has been laid bare as Britain forecast to endure its deepest annual recession in more than three centuries, with the economy expected to shrink 11.3% in 2020.
The Dow and the S&P 500 ended lower on Wednesday after hitting record highs the day before, while the Nasdaq hit a new all-time high as tech companies – which took advantage of people being forced to stay at home – jumped up.
Asian markets drifted, with Tokyo, Hong Kong, Seoul, Taipei and Jakarta rising, but Shanghai, Sydney, Singapore, Manila and Wellington falling.
– “ Increased downside risks ” –
Still, analysts were optimistic about the outlook, with Xi Qiao of UBS Global Wealth Management saying: “We believe the market rally may continue from here, fueled by all the positive vaccine news, more clarity political with a peaceful transition to the White House and with more stimulus to come.
“We are already seeing strong turnover in cyclical and reopening trades with vaccine news and we expect this trend to continue.”
But Fed officials fear the U.S. economy will face lingering pain unless lawmakers agree on a new bailout deal, with minutes showing they said no action would mean “significant difficulties for a number of households”.
Council members felt the surge in Covid-19 cases “was a downside risk for the recovery”, while some noted that the worsening chances of a new spending plan “increased downside risks and added to the uncertainty on the economic outlook. “
Gorilla Trades strategist Ken Berman said the minutes left investors slightly disappointed as they gave no indication of when the bank might unveil further monetary easing measures.
However, most observers said weaker economic data would more than likely prompt the Fed to make an announcement soon, perhaps next month.
Oil prices have extended their gains – after rising nearly 30% this month – with the rollout of vaccines raising hopes of increased demand as life returns to normal.
– Key figures around 03:00 GMT –
Tokyo – Nikkei 225: + 0.7% to 26,470.28 (pause)
Hong Kong – Hang Seng: + 0.1% to 26,693.94
Shanghai – Composite: Down 0.3% to 3,353.17
Euro / dollar: UP to $ 1.1925 from $ 1.1914 at 22:00 GMT
Pound / dollar: UP to $ 1.3390 from $ 1.3378
Dollar / yen: LOW 104.32 yen vs. 104.45 yen
Euro / pound: DOWN to 89.02 from 89.05 pence
West Texas Intermediate: + 0.7% to $ 46.05 per barrel
North Sea Brent: + 0.9% to $ 49.05 per barrel
New York – Dow: Down 0.6% to 29,872.47 (close)
London – FTSE 100: Down 0.6% to 6,391.09 (close)
© 2020 AFP