Visitors stands in front of an electronic ticker at the Tokyo Stock Exchange (TSE), operated by Japan Exchange Group Inc. (JPX), in Tokyo, Japan, on Monday, Nov. 30, 2020.
Toru Hanai | Bloomberg via Getty Images
SINGAPORE — Asia-Pacific markets traded higher Wednesday as investors returned to risky assets, confident that a massive U.S. stimulus package will soon be approved.
The Nikkei 225 climbed 0.67% in early trade while the Topix index added 0.27%. South Korea’s Kospi jumped 1.27% and the Kosdaq was up 1.44%.
In Australia, the benchmark ASX 200 rose 0.24% but the energy sector notched a 1.77% loss as oil prices remained under pressure.
The session in Asia-Pacific follows an overnight session on Wall Street where bond yields declined and tech stocks staged a comeback — the Nasdaq Composite climbed 3.7% to post its best day since November.
“Global equities pushed higher as risk appetite returned,” according to a Wednesday morning note from analysts at ANZ Research. “Investor confidence was buoyed by expectations that (U.S. President Joe) Biden’s USD1.9trn fiscal stimulus package will soon be approved.”
Currencies and oil
In the currency market, the U.S. dollar last traded at 91.958 against a basket of its peers, falling off an earlier high of 92.503.
The Japanese yen changed hands at 108.57 per dollar, strengthening from a previous level around 108.69, while the Australian dollar traded near flat at $0.7711.
Carol Kong, a currency strategist at the Commonwealth Bank of Australia, said in a morning that outside of short-term downside risks, the bank is bullish on the Australian dollar, predicting it will reach around $0.83 in the third quarter of 2021.
“Australia’s successful virus containment has contributed to its ‘v‑shaped’ economic recovery,” Kong said in the note, adding that with Covid-19 vaccines being rolled out that bounce back could accelerate. That could potentially tighten the labor market earlier than expected.
“As a result, the (Reserve Bank of Australia) may tighten monetary policy before the (U.S. Federal Reserve) which poses upside risks to our AUD/USD forecast profile,” she said.
Elsewhere, oil prices remained under pressure. During Asian trading hours on Wednesday, U.S. crude fell 0.11% to $63.94 while global benchmark Brent declined in the overnight session.
Source: CNBC