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US stimulus bill lifts Asian equities

Trump signs stimulus/spending bill into law

With liquidity lower than usual and a dearth of meaningful news over the weekend, the presidential signing of the omnibus bill today has lifted sentiment in Asia. Most of the region is green, although the gains scale is modest, perhaps reflecting the holiday-thinned participation. As far as President Trump is concerned, there is still more work to be done on the stimulus bill. Both the Financial Times and Bloomberg are saying that the president has claimed that the GOP Senators and the Democrat-controlled House will vote on increasing the USD600 payment. Additionally, Section 230 (the social media content liability shield) would be repealed, and an investigation in voter fraud commenced. However, legally speaking, the bill is a done deal.

Asian markets are mostly in positive territory on Monday. The Nikkei 225 has risen 0.40%, with the Kospi rushing 0.70% higher out of the gates this morning. Singapore is 0.20% higher, Taipei has rallied 0.75% higher, with Kuala Lumpur jumping 0.80% and Jakarta up 0.15%. Only Manila is lagging regionally, down 1.30% in early trading.

China has shrugged off news that Ant Financial has been told to go back to basics by the PBOC this weekend. The threatened breakup coming after its parent Alibaba’s shares tanked in the US on Thursday after Chinese authorities announced investigations into its business practises. Not being listed on the mainland may have been a blessing in disguise for the Shanghai Composite and CSI 300, which are higher by 0.30% and 0.50% respectively. Hong Kong has weathered the storm as well, despite Alibaba being listed there. The Hang Seng has risen 0.35% today.

Australia and the United Kingdom are closed today for Boxing Day, but European equities should also catch the US stimulus tailwind and move higher. Sentiment should also receive a modest boost with the start of Covid-19 vaccinations across the Eurozone at the weekend.

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 [4]

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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