Shares in mainland China and Hong Kong bounced back as investors shelved yet another record surge in coronavirus cases in the US.
China’s CSI 300 index of stocks listed in Shanghai and Shenzhen rose as much as 3.7 percent in early trading on Monday, the biggest gain since February 2019 and extended recent gains after closing at a five-year high. on Friday. Hong Kong’s Hang Seng Index added more than 2 percent.
Traders said China’s retail investors, a dominant force in mainland China’s stock markets, were piling up stocks in the tech and internet sectors as they gambled on driving the country’s economic recovery. Data released on Friday showed that activity in the Chinese service sector had increased in June, and consumer spending recovered after the coronavirus blockade.
“Individual investors in China are really optimistic about the economic reopening,” said Dickie Wong, chief executive of Kingston Securities, adding that traders were willing to sideline risks related to mounting tensions between the United States and China.
Elsewhere, Topix of Japan and Kospi of South Korea added 1.3 percent.
Futures suggested the S&P 500 would open 0.9 percent more when U.S. operations resume later the Monday following the four-day weekend of July 4.
The upbeat mood in the stock markets came despite signs of further waves of the coronavirus in several countries, including the United States. That could damage hopes for a strong V-shaped recovery in the global economy, fueled by data from last week that showed the United States added nearly 5 million jobs in June.
The United States reported its highest number of Covid-19 infections on a Sunday, more than 42,500, as the country celebrated July 4. In addition to the more than 52,000 cases reported on Saturday.
Several states called the Sun Belt, such as Arizona and Florida, have been hit hard by the current wave of infections, raising fear of further economic blockages.
Australia’s S & P / ASX 200 fell 0.1 percent when a wave of infections in Victoria caused the state border with neighboring New South Wales to close.
But after the powerful rally in global stock markets since its March lows, some investors have indicated they may stay on the sidelines until they see stronger evidence of a recovery in corporate earnings.
“We expect global stocks to continue around current levels in 12 months,” Citi analysts wrote. “We would not be chasing markets higher than current levels, but we would rather wait for the next drop.”
Oil prices remained near the four-month highs, but without any clear direction, as investors digested the potential impact on demand for new US blockades.
Brent crude, the international benchmark, added 0.2 percent to $ 42.89 a barrel. West Texas Intermediate, the American marker, fell 0.7 percent to $ 40.34 a barrel.
The yield on 10-year US Treasuries, viewed by investors as a safe-haven asset, increased 0.02 percentage points to 0.689 percent. Bond prices fall as yields rise,
