Asian equities start week higher

Wall Street gains spill into Asia

Wall Street finished the week strongly on Friday, and that sentiment has spilled into the Asia-Pacific region this morning. Except for Singapore, the region’s stock markets are recording strong gains to start the week.

Gilead Sciences Inc. led Wall Street higher, following the positive results from its latest Remdesivir trial on Covid-19 patients. That sparked a wave of peak-virus optimism in stock markets, although I note that the trial was only 318 people with no control group. Still, why let science get in the way of a good story. The S&P 500 rose 1.05%, the Nasdaq made yet another record high close, climbing by 0.66%, and the Dow Jones jumped by 1.43%.

In Asia, the Nikkei and Kospi have started brightly, rising 0.90% and 1.45% respectively. Continuing profit-taking in financial market stocks has been offset by a rally in industrials in mainland China today. The Shanghai Composite and CSI 300 are both up around 1.0%, with the Hang Seng climbing 0.90%.

Across South East Asia, the picture is much the same except for Singapore. Although the PAP returned to power on Friday’s election, their total share of the popular vote was the lowest on record. That is hanging over the Straits Times today ahead of data this week. The index is down 0.15% thus far today.

Australian stock markets are higher, but the Victoria State lockdown and the prospect of deeper lockdowns for Melbourne, are limiting gains. The All Ordinaries is up 0.85%, with the ASX 200 up 0.75%.

Friday and today’s rallies are built on hope versus reality. We have been here many times before, though, and fighting the short-term momentum is a pointless exercise. Either stay on the sidelines or tactically join in the party. But leave your finger over the sell-button for the first sign of trouble. The sentiment is likely to ensure that European stocks open higher this afternoon as well.

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Jeffrey Halley

Jeffrey Halley

Senior Market Analyst, Asia Pacific, from 2016 to August 2022
With more than 30 years of FX experience – from spot/margin trading and NDFs through to currency options and futures – Jeffrey Halley was OANDA’s Senior Market Analyst for Asia Pacific, responsible for providing timely and relevant macro analysis covering a wide range of asset classes. He has previously worked with leading institutions such as Saxo Capital Markets, DynexCorp Currency Portfolio Management, IG, IFX, Fimat Internationale Banque, HSBC and Barclays. A highly sought-after analyst, Jeffrey has appeared on a wide range of global news channels including Bloomberg, BBC, Reuters, CNBC, MSN, Sky TV and Channel News Asia as well as in leading print publications such as The New York Times and The Wall Street Journal, among others. He was born in New Zealand and holds an MBA from the Cass Business School.
Jeffrey Halley
Jeffrey Halley

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