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SYDNEY (Reuters) – Asian stocks advanced to record highs on Monday and oil rose to a more than a year high as successful launches of the coronavirus vaccine globally raise hopes for a rapid economic recovery in means of new tax aid from Washington.
MSCI’s broader Asia-Pacific equity index outside of Japan rose 0.4% to 736.4.
Japan’s Nikkei rose 1.3%, despite data showing the country’s recovery from its worst post-war recession slowed in the fourth quarter.
Australia’s benchmark index was up 1%.
E-mini futures for the S&P 500 were up 0.2% in early Asia trading. The US stock markets will be closed on Monday for the Presidents’ Day holiday.
The highlight of the week will likely be the minutes of the January meeting of the US Federal Reserve, where the authorities decided to leave rates unchanged.
Inflation data comes from the UK, Canada and Japan, while major economies, including the US, will release preliminary February Purchasing Managers Indices (PMIs) on Friday.
While economists expect inflation to remain benign for some time, the so-called “reflation trade” has gathered steam in recent days led largely by coronavirus vaccines and hopes for massive fiscal spending under the president. from the United States, Joe Biden.
Biden lobbied for the first major legislative milestone of his tenure, turning to a bipartisan group of local officials to help him with his $ 1.9 trillion coronavirus relief plan.
“In our opinion, as long as the rise (in inflation) is gradual, the equity markets can continue to perform well. However, the rogue moves would certainly hurt investor confidence, ”said Esty Dwek, director of global market strategy for Natixis Investment Managers Solutions.
“Credit spreads have already narrowed dramatically, but they still have room to absorb some higher returns, which makes us more comfortable with credit risk than interest rate risk,” added Dwek.
“Commodities would benefit from an inflation cycle but can still continue to recover without high core inflation as economies reopen and demand recovers.”
Oil prices rose to their highest level since January 2020 in hopes that the US stimulus will boost the economy and demand for fuel.
Brent crude rose 61 cents to $ 63.04 a barrel. US crude oil gained 83 cents at $ 60.03.
On Friday, the S&P 500 and the Nasdaq set closing record highs. The Dow finished 0.1% higher at 31,458.4 points, the S&P 500 gained 0.5% at 3,934.83 and the Nasdaq added 0.5% at 14,095.47. [.N]
Action in coins was muted.
The dollar was slightly higher against the Japanese yen at 105.07 while the euro was flat at $ 1.2119 and the British pound was up 0.1% at $ 1.3868. Risk-sensitive Australian and New Zealand dollars were unchanged.
That left the dollar index stable at 90,426.
Bitcoin barely changed in early Asian trading at $ 48,722, slightly down from a record high of $ 49,000. It posted gains of about 20% in a historic week marked by backing from major firms like Elon Musk’s Tesla.
Report from Swati Pandey in Sydney; Edited by Kim Coghill
