Gains are beginning to broaden out from the technology giants who have helped power much of the past months’ surge, analysts say
HONG KONG • Asian equities were mixed yesterday following another blow-out session on Wall Street, with new vaccine hopes and central bank largesse offset by well-below-forecast US jobs reading and tensions between Washington and Beijing.
Payrolls firm ADP LLC said the US added 428,000 new jobs in August — a third of what was expected — boding ill ahead of the release of today’s much-anticipated government data, which is used as a guide for the state of the world’s top economy.
Still, the S&P 500 and Nasdaq clocked record highs, and the Dow jumped an impressive 1.6%.
Analysts pointed out that gains were beginning to broaden out from the technology giants who have helped power much of the past months’ surge.
“Quite why the rally has broadened out is frankly anyone’s guess, though both the ‘rates lower for longer’ and ‘vaccine round the corner’ pretexts received some (small) succour overnight,” said National Australia Bank’s Ray Attrill.
US officials have called on states to prepare to distribute a possible vaccine by Nov 1 — two days before the presidential election.
Robert Redfield, head of the Centres for Disease Control and Prevention (CDC), said in an Aug 27 letter that state leaders should consider waiving requirements that would “prevent these facilities from becoming fully operational by Nov 1, 2020”.
The CDC explained details of a rollout plan, adding that they would either be approved as licensed vaccines or under emergency use authorisation.
US President Donald Trump’s top infectious diseases official, Dr Anthony Fauci (picture), on Wednesday told NBC: “I believe that by the time we get to the end of this calendar year, we will feel comfortable that we do have a safe and effective vaccine.”
The New York rally seeped through to Asia early yesterday, but some markets were unable to maintain their rallies.
Tokyo, Seoul, Sydney and Wellington all posted big gains, while Taipei, Manila and Bangkok were also higher. Mumbai and Singa- pore were in the red.
Hong Kong and Shanghai were well down after Washington’s decision to impose fresh restrictions on Chinese diplomats in the US, the latest salvo in a long-running standoff that includes issues including the virus to technology and trade.
The new requirements of the People’s Republic of China (PRC) diplomats “are a direct response to the excessive restraints already placed on our diplomats by the PRC”, Secretary of State Mike Pompeo said in a statement.
“Should the PRC eliminate the restrictions imposed on US diplomats, we stand ready to reciprocate.”
Traders were keeping tabs on Capitol Hill, hoping US lawmakers will at some point reach an agreement on a new stimulus package, though expectations are not high.
Democratic House Speaker Nancy Pelosi said there were still big differences with Republicans following a phone call with Treasury Secretary Steven Mnuchin.
The two sides remain about a trillion dollars apart in their proposals and Pelosi has said she will not give in to pressure from the White House to pass a partial deal including areas they agree on, then discuss other issues at a later date.
In early trade, London, Paris and Frankfurt saw healthy gains. — AFP