ASIAN SHARES INCH UP AS NEW U.S. STIMULUS LOOMS
Asian shares rose on Friday, brushing off a late Wall Street dip as expectations of large US stimulus under President-elect Joe Biden shored up sentiment while oil prices perked up on upbeat Chinese trade figures, Reuters reported.
President-elect Biden will unveil a $1.9 trillion stimulus package proposal designed to jump-start the economy and speed up the US response to the coronavirus pandemic, officials said on Thursday.
While US stocks spent most of the trading session in positive territory, helped by the stimulus hopes, some concerns about the details of the package led to a modest decline towards the end of Wall Street trade.
“The concern is what it’s going to mean from a tax standpoint,” said Tim Ghriskey, chief investment strategist at Inverness Counsel in New York. “Spending is easy to do but the question is how are you going to pay for it? Markets often ignore politics but they don’t often ignore taxes."
In Asia, investors held a broadly more optimistic with Australia’s S&P/ASX 200 up 0.2%, Japan’s Nikkei 225 0.3% higher and South Korea’s KOSPI inching up 0.2%. Investors had also kept an eye on Federal Reserve Chair Jerome Powell, who struck a dovish tone in comments at a virtual symposium with Princeton University.
Powell said the U.S. central bank is not raising interest rates anytime soon and rejected suggestions the Fed might start reducing its bond purchases in the near term.
On Wall Street, the Dow Jones Industrial Average fell 0.22%, the S&P 500 lost 0.38%, and the Nasdaq Composite dropped 0.12%. Treasury yields edged higher in anticipation of the new stimulus package. Benchmark 10-year Treasury notes last fell 12/32 in price to yield 1.1292%, from 1.088% late on Wednesday.
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