Asian stock markets mostly higher despite Omicron’s threat

FILE IMAGE: The electronic stock exchange list will be on display in the conference hall in Tokyo, Japan on November 1, 2021. REUTERS / Issei Kato

Author: Scott Murdoch

HONG KONG (Reuters) – Asian stock markets rose broadly on Wednesday as global investors’ risk appetite rises towards the end of the year, despite an increase in Omicron COVID-19 variants around the world.

MSCI’s broadest Asia-Pacific stock index outside of Japan rose 0.24% in the afternoon’s trade, after being higher earlier in the day.

Australian stocks rose 0.13%, reversing a weaker start that analysts said was due to the rise in the US dollar overnight, which reduced demand for commodities and industry stocks.

The North Asian market showed some weakness later in the day.

Japan’s Nikkei stock index fell 0.05% and China’s and China’s blue-chip CSI 300 index fell 0.04%.

But in Hong Kong, the Hang Seng index rose 0.27% after jumping 1.2% at the start of trading.

Futures trading on Wednesday showed volatile developments in other regions.

In the initial phase of trading in Europe, Euro Stoxx 50 futures in the general area rose 0.43% to 4,172.5 points, while US stock futures, the S&P 500 e-minis, fell 0.1% to 4,636 points.

A better night on Wall Street brought positive leadership to the Asian market, and the US stock market rose sharply.

The Dow Jones Industrial Average rose 560.54 points or 1.6% to 35,492.7 points, the S&P 500 rose 81.21 points or 1.78% to 4,649.23 points and the Nasdaq Composite 360.14 points or 2.4 percent to 115 , To 3 percent.

The leap occurred despite growing concern about the spread of the Omicron COVID-19 variant before traditional holiday seasons around the world.

“Investors are looking at the fundamentals of the global economy and there are a lot of positive indicators when looking at household balance sheets, consumption and corporate profits are high,” said Kerry Craig, global market strategy at JPMorgan Asset Management.

“It’s positive for the market and shows that the basic picture of the economy is good and why people are interested in owning assets like stocks.”

The Omicron variant, first detected last month, causes infections to double in 1.5 to 3 days, according to the World Health Organization. It is not yet known whether it causes a more serious disease than the Delta variant.

However, Asian investors mostly ignored the current rise in case numbers.

“Customers are still happy to buy here despite the obvious market and health risks, mostly they are increasing their existing positions,” John Milroy, an adviser to Ord Minnett from Sydney, told Reuters.

“After two years, customers are tired of talking about it (COVID-19) and admit that they are once again focused on the merits that we think should be really good.”

Hong Hao, research manager at BOCOM International, said Chinese investors focused more on potential supply chain problems from the continent’s COVID epidemics.

“I would say investors are looking at (COVID-19) case numbers as long as it doesn’t affect China’s production capacity,” he told Reuters.

“Investors seem to be more relaxed … In China, the biggest concern is still the real estate industry.”

In Asian trade, the yield on 10-year bonds was 1.46%, compared with 1.487% in the US on Tuesday. The two-year return, which rises in line with traders ’expectations of higher Fed fund interest rates, rose to 0.6626%, compared with 0.675% in the United States.

The dollar rose 0.04% against the yen to 114.13. It is still some distance from this year’s highest of 115.51, which hit on November 24th. The dollar index, which tracks the dollar against the basket of currencies of other major trading partners, rose to 96.56.

U.S. crude crude rose 0.35% to $ 71.37, while Brent crude rose $ 74.07 a barrel.

Gold was slightly lower with a spot price of $ 1,787,396 an ounce.

(Report: Scott Murdoch in Hong Kong; edited by Stephen Coates and Kenneth Maxwell)

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