Most Asian markets lifted by recovery optimism | Inquirer Business
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Most Asian markets lifted by recovery optimism

/ 11:23 AM May 06, 2021

 (AFP)

HONG KONG – Most markets across Asia rose Thursday as investors welcomed a strong jobs report from the United States that reinforced optimism that the world’s top economy is well on the recovery track, though inflation concerns continue to dog trading floors.

The White House’s support for a global waiver on patent protections for Covid vaccines also provided some cheer as it lifted hope for a speedier recovery in poorer nations that have struggled to access the life-saving drugs.

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US private firms added 742,000 jobs in April, payrolls firm ADP said Wednesday, marking a fourth straight monthly gain, with much of them in the crucial services sector, which was hardest hit by virus lockdowns and other restrictions last year.

The reading, while slightly short of forecasts, confirmed that the battle against unemployment is being won, and analysts said the improvement was expected to continue as the reopening continues.

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It also bodes well for Friday’s closely watched government data, which provides a snapshot of the state of the economy.

But there is a growing fear that the expected burst of economic activity this year caused by pent-up consumers returning to stores and restaurants — with government cash in their pockets — will send inflation rocketing and force the Federal Reserve to tighten its ultra-loose monetary policy.

And traders are struggling to take heart from reassurances from top Fed officials, who have repeatedly said the bank will stick to its guns until it has unemployment tamed and inflation is running consistently hot.

 ‘Monumental moment’

In early trade, Tokyo rose two percent and Shanghai also advanced as investors in those cities returned to trading floors for the first time since Friday, while Hong Kong, Singapore, Seoul, Taipei, Manila and Jakarta were also in positive territory.

Sydney and Wellington dipped.

The gains followed a strong lead from Europe, where London hit a more than 14-month high and strong eurozone growth figures also sent Paris and Frankfurt surging.

The Dow and S&P 500 edged up but the Nasdaq fell again owing to further weakness in the tech sector.

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Investors welcomed comments from US Trade Representative Katherine Tai, who said the Biden administration “supports the waiver of those protections for Covid-19 vaccines” in order to end the pandemic, which has killed more than three million and battered the global economy.

World Health Organization boss Tedros Adhanom Ghebreyesus called the decision “historic” and marked “a monumental moment in the fight against Covid-19”.

Better access for more countries to the drugs would help allow them to reopen their economies sooner and help the global recovery effort.

Oil prices inched down but remain supported by demand optimism as vaccines are rolled out and economies reopen, though fears about the spike in infections in major consumer India has kept a lid on further gains.

Brent is sitting close to levels not seen since January last year before the pandemic took a grip on the planet.

Key figures around 0230 GMT

Tokyo – Nikkei 225: UP 2.0 percent at 29,391.19 (break)

Hong Kong – Hang Seng Index: UP 1.1 percent at 28,725.83

Shanghai – Composite: UP 0.2 percent at 3,454.84

Euro/dollar: UP at $1.2006 from $1.2002 at 2030 GMT

Pound/dollar: DOWN at $1.3897 from $1.3908

Euro/pound: UP at 86.39 pence from 86.30 pence

Dollar/yen: UP at 109.35 yen from 109.19 yen

West Texas Intermediate: DOWN 0.1 percent at $65.56 per barrel

Brent North Sea crude: DOWN 0.1 percent at $68.91 per barrel

New York – Dow: UP 0.3 percent at 34,230.34 (close)

London – FTSE 100: UP 1.7 percent at 7,039.30 (close)

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