Asian markets bounce on US aid

TOKYO: Asian markets mostly rose Wednesday following two days of selling, while investors appeared initially unfussed after Donald Trump called a new stimulus package “a disgrace” and told US lawmakers to amend it.

Equities and oil prices have taken a hit recently as virus cases surged across the planet and a new more transmissible strain was reported in the UK, forcing governments to impose tight restrictions and lockdowns to contain the disease over the festive period.

The worrying spike in infections has overshadowed the rollout of vaccines and news at the start of the week that Congress had finally hammered out an economic rescue package worth around $900 billion.

“So much of the good news of the vaccine had been already digested and even the stimulus bill that people had largely anticipated,” Joanne Feeney of Advisors Capital Management said on Bloomberg TV.

“So some of the flattening of the market just reflects how much has already been built into the market from those two good sources of news.”

However, Hong Kong, Tokyo, Shanghai, Sydney, Seoul, Taipei and Jakarta were all in positive territory after recent losses, while Wellington extended gains. Singapore and Manila fell.

New York stock futures dropped, though, after Trump’s outburst against this week’s stimulus agreement.

The outgoing president slammed the package as not having enough for American families and told Congress to rethink it, raising the possibility it being held up until after Christmas.

“It really is a disgrace,” he said in a video message posted on Twitter. “I am asking Congress to amend this bill and increase the ridiculously low $600 to $2,000, or $4,000 for a couple,” he said, referring to relief cheques being prepared.

“I’m also asking Congress to immediately get rid of the wasteful and unnecessary items from this legislation, and just send me a suitable bill.”

While Asian traders appeared to take the comments in their stride, DailyFX strategist Ilya Spivak warned: “This is yet another catalyst to inspire people to cash out.”

And Axi analyst Stephen Innes warned the first quarter of 2021 could be a struggle for markets.

Source: TheManila Times