The Maharashtra government on Sunday reversed its earlier decision to keep gyms, beauty salons and spas shut amid an ongoing Covid scare and instructed in its revised guidelines to allow these establishments to function at a 50% capacity. The government in its statement said that beauty salons shall be grouped with hair-cutting salons and hence shall be permitted to function at a 50% capacity. It however stressed that under this revised guideline, only activities that…
HONG KONG (Reuters) – A global share rally continued in Asian trading on Thursday and the safe haven dollar slid as markets welcomed signs that the Omicron variant of COVID-19 might be less severe than feared, as well as robust U.S. economic data.
Japan’s Nikkei gained 0.57% and MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.55%, a third successive session of gains as it recovered from a jolt on Monday when worries about the new coronavirus strain gripped markets and pushed investors to safe-haven assets like the greenback.
European markets were also heading towards a positive open, with pan-region Euro Stoxx 50 futures up 0.45% and FTSE futures 0.45% higher.
“The unpredictable path of the pandemic and its related impacts on growth and inflation continue to dominate investor risk appetite,” said David Chao, global market strategist Asia Pacific at Invesco.
“The recent health data from the UK and other places around the world indicate that the worst case is unlikely: even though (Omicron) transmission rates are reportedly higher, this variant seems less virulent and less prone to cause serious illnesses or death.”
The risk of needing to stay in hospital for patients with the Omicron variant of COVID-19 is 40-45% lower than for patients with the Delta variant, according to research by London’s Imperial College published on Wednesday.
Meanwhile the main U.S. benchmarks ended higher overnight after data showed U.S. consumer confidence improved further in December, and the White House said it was resuming talks on a massive social spending and climate change bill with holdout senator Joe Manchin. [.N]
However, while markets on both sides of the Pacific have gained this week, MSCI’s broad Asian benchmark’s gains began from Monday’s year low, while U.S. benchmarks are in sight of last month’s record highs.
Strong economic growth in the United States and jitters sparked by sweeping regulatory changes in China earlier this year – which roiled shares in industries from technology to property – have driven investment away from Asia.
Hong Kong’s Hang Seng Index has been hard hit, falling 15% in 2021, on track for its worst year since 2011.
On Thursday, the benchmark rose 0.2%, though index constituent JD (NASDAQ:JD).com’s shares dropped as much as 11% after the ecommerce company’s largest shareholder, Tencent, said it would give most of its $16.4 billion stake to its own shareholders as a dividend. [L4N2T802E]
“Obviously Hong Kong stock market is one of the worst performing markets in the entire world, but I do see some momentum now,” said Dickie Wong, executive director for research at local brokerage Kingston Securities.
Wong pointed to a boost from the rebound in U.S. markets and the fact that some investors were starting to see low prices for some internet and technology stocks as a buying opportunity.
In currency markets, in line with the ‘risk-on’ mood, the dollar index dropped to as low as 96.018, its lowest since Dec. 17.
Recent losses have been fairly broad-based; the euro has gained for the last four sessions, and the Australian dollar – often seen as proxy for risk appetite – is up 1.2% on the week.
The yield on benchmark 10-year Treasury notes was last at 1.4583%, comfortably in the middle of its recent range.
Oil prices also rose, again in line with optimism about the state of the global economy, also helped by a larger-than-expected drawdown in U.S. inventories Wednesday. [O/R]
Brent crude futures rose 0.3% to $75.53 a barrel. U.S. West Texas Intermediate (WTI) crude futures rose 0.27% to $72.96.
Spot gold rose 0.22% to 1,807 an ounce, helped by the weaker dollar. [GOL/]