Hong Kong
Asian markets rallied out of the blocks Monday, with further signs of economic recovery continuing to resonate with investors more than a surge in coronavirus infections across the planet.
The easing of lockdowns is providing hope the global economy will bounce back from an expected recession this year, with England’s pubs reopening at the weekend and tourist attractions around Europe now either open or planning to.
Better-than-forecast data on US jobs creation and factory activity have also provided a boost to confidence, as have hopes for a vaccine, which observers say is key to kickstarting any recovery.
Traders have piled back into stocks in a major way in recent months—with the help of vast government and central bank support—and analysts have suggested the gains are also being helped by a fear of missing out on the rally.
“The global economic data and positive coverage on potential COVID-19 vaccines and treatments represent a… whirligig of positive news that is overwhelming gnarly headline flows around the daily virus case counts in the US,” said AxiCorp’s Stephen Innes.
Shanghai led the gains, soaring more than five percent to a more than two-year high, while Hong Kong finished up 3.8 percent at levels not seen since early March.
Jeffrey Halley at OANDA said: “Hong Kong concerns are fading as fast as they began, as the new China-imposed security laws allow money to talk without the annoying interference of protestors.” But he added that the “story still has more to run in a geopolitical context”, pointing out that Donald Trump was still to sign a bill censuring Chinese officials linked to the law, which would likely lead to retaliation by Beijing.
“The scale of those measures will dictate whether geopolitics will have more to say on global financial markets,” he said in a note. Tokyo piled on 1.8 percent, while Singapore, Seoul and Taipei were all more than one percent higher, with Wellington and Jakarta also up. London, Paris and Frankfurt all soared more than two percent at the open.—AFP
