MSCI’s gauge of Asia-Pacific shares excluding Japan advanced 0.1%, and Chinese blue chips gained 1.45%
Asian shares edged up on Thursday and were set to end a tumultuous 2020 at record highs, while growing investor hopes for a global economic recovery caused the dollar to fall further against most major currencies.
MSCI’s gauge of Asia-Pacific shares excluding Japan rose 0.1% to its latest peak, having explored fresh territory repeatedly late in the year. But year-end trading was typically thin.
The index is set for a fourth-quarter gain of over 19%, which would be its strongest three-month performance since 2009, and a yearly rise just shy of 20%, which would be its highest since 2017.
A lot of the rise in the second part of the quarter is because the political risk evaporated, said Kerry Craig, Global Market Strategist, J.P. Morgan Asset Management, citing the U.S. election, hopes for an easing in U.S. China trade tensions and the Brexit deal.
Looking to 2021, Craig said investors were trying to balance the potential for rising inflation against a likely economic recovery, and assess whether that rebound might be impeded early in the year by new strains of COVID-19 and struggles with rolling out vaccines.
Chinese blue chips rose 1.45% on Thursday after official data showed that activity in China’s service and factory sector expanded in December, albeit both at a slower pace than the previous month. The Hong Kong benchmark also rose 0.26%.
Australian shares fell 0.80% after tighter restrictions on movement were announced in an effort to quash fresh COVID-19 cases.
Markets in Japan and South Korea are on holiday.
E-Mini S&P futures rose 0.10%.
The dollar dropped against a basket of currencies, sinking 0.074% to 89.528, after earlier touching it lowest since April 2018.
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