MSCI’s broadest index of Asia-Pacific shares outside Japan was up 3.7% so far this week, Australian shares added 0.16%, Hang Seng TECH Index rose more than 3%
Shares in Asia held onto their recent gains on Wednesday after last week’s battering, as global equities bounced back amid positive COVID-19 vaccine news and easing concerns over tapering of Federal Reserve stimulus.
MSCI’s broadest index of Asia-Pacific shares outside Japan was slightly lower, but still up 3.7% so far this week. The index dropped to its lowest in 2021 at the end of the previous week.
Markets were mixed with Australian shares adding 0.16%, but Chinese blue chips dropping 0.24%.
Japan’s Nikkei was flat. A Reuters poll of analysts and fund managers showed Japanese shares are expected to recover from their eight-month low marked on Friday to near a 30-year high by the end of this year.
Asia was anchored by overnight gains in all three major U.S. stock indexes, with the Nasdaq and S&P 500 ending the day at all-time closing highs.
Investors continue to fret over the spread of the Delta variant of coronavirus, but the U.S. Food and Drug Administration (FDA) granted full approval on Monday to the COVID-19 vaccine developed by Pfizer Inc, raising hopes inoculations could accelerate.
The Hong Kong benchmark climbed nearly 1% on opening but was last down 0.5%, after posting its best day in a month the day before as the market pulled further away from last week’s finish of its lowest close for this year.
The Hang Seng TECH Index rose more than 3%, building on this week’s strong gains as investors piled into oversold stocks, but later gave up those gains to trade flat.
It’s been a fairly obvious trade to go back to neutral particularly on stocks that have been oversold, said Rob Munford, a Hong Kong based investment manager at GAM Investments.
How it progresses from here, I don’t think is as much about China and Asia but what the U.S. does. If it’s a benign scenario out of Jackson Hole I think you’ll definitely see China mean revert, he said.
Meanwhile, the US Fed will hold its annual economic symposium on Friday. The focus remains on Fed Chair Jerome Powell’s remarks at the event for any clues regarding the timeline for Fed’s tapering of asset purchases.
If Powell speaks about the policy outlook and more specifically, hints at the time and/or pace of tapering, the USD could get a boost in our view, wrote analysts at CBA in a note.
They stated: In the meantime, the USD will remain guided by broader market mood.
This article is for information purposes only.
Please remember that financial investments may rise or fall and past performance does not guarantee future performance in respect of income or capital growth; you may not get back the amount you invested.
There is no obligation to purchase anything but, if you decide to do so, you are strongly advised to consult a professional adviser before making any investment decisions.