Asian equities race higher

Biden win boosts equity markets

Equity markets are on fire today following the US elections being called for Joe Biden. Mr Biden is perceived as being more friendly for trade, and with the Republican’s indicting an unwillingness to back large-scale fiscal stimulus, more monetary easing is on the way.

On the fundamental front, US Non-Farm Payrolls and the Unemployment Rate released on Friday both outperformed. Payrolls rose by 638,000 jobs, although the number hid a slide in Federal and State government’s hiring, with census workers laid off and state governments shrinking payrolls to balance budgets. Unemployment fell impressively to 6.90%, but again, the headline number may flatter to deceive. At the same time, these October employment numbers indicate a slight improvement in the labour market, as the US economy continues to take small steps on the road to economic recovery.

US index futures have leapt higher today; the Nasdaq is up 2.0% with the S&P 500 and Dow Jones futures both over 1.0% higher. Looking at the charts, I would hazard that new record highs are inevitable. The Economist magazine hasn’t said the same thing, so I am confident with that call.

Across Asia, the picture is much the same, a sea of green. The Nikkei 225 is 2.30% higher, and the Kospi is 1.25% higher. In China, the Shanghai Composite is 1.90% higher after impressive China export data, with the CSI 300 up 0.70%. Hong Kong has rallied 1.50% with Ant Financial well and truly forgotten.

Singapore has climbed 1.05%, led by banks, with Taiwan up 1.20%, Malaysia eking out a 0.10% gain as political concerns continue weighing, and Indonesia 1.50% higher. In Australia, the All Ordinaries and ASX 200 are 1.70% higher, with iron ore futures rallying this morning in China.

Europe is expected to follow suit, and I expect the Biden afterglow to withstand any tweets from the White House or threats of legal challenges. That should be the theme of the entire week.

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
With more than 30 years of FX experience – from spot/margin trading and NDFs through to currency options and futures – Jeffrey Halley is 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, Channel News Asia and the New York Times. He was born in New Zealand and holds an MBA from the Cass Business School.
Jeffrey Halley
Jeffrey Halley

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