Asian markets eye muted start on economic hopes, pandemic fears

By Pete Schroeder (Reuters) - Asian markets were set for sideways trade at Thursday's open as lingering pandemic concerns pushed against stronger economic data, and with little firm direction from Wall Street. Australia's benchmark S&P/ASX 200 index was down 0.1% in early trading, while Japan's Nikkei 225 futures were up 0.05%.

Reuters February 18, 2021 06:05:13 IST
Asian markets eye muted start on economic hopes, pandemic fears

Asian markets eye muted start on economic hopes pandemic fears

By Pete Schroeder

(Reuters) - Asian markets were set for sideways trade at Thursday's open as lingering pandemic concerns pushed against stronger economic data, and with little firm direction from Wall Street.

Australia's benchmark S&P/ASX 200 index was down 0.1% in early trading, while Japan's Nikkei 225 futures were up 0.05%. Hong Kong's Hang Seng index futures were down 0.2%.

The MSCI's global stock index was up 0.04%.

Strong retail sales out of the United States, coupled with new indications the Federal Reserve will maintain its accommodative stance and an ongoing push for further U.S. stimulus, helped drive expectations the world's largest economy will continue to post gains coming out of the pandemic.

But concern at the rapid spread of new variants tempered enthusiasm.

"With an even larger stimulus package likely to be passed by Congress before the end of March, the U.S. economic recovery could gain more momentum in 2021," wrote Commonwealth Bank of Australia currency analyst Carol Kong.

"Despite the recent positive vaccine developments, the global economic outlook remains uncertain partly because of the spreading virus variants."

On Wall Street, technology stocks faced some pressure on inflation concerns, driving down the Nasdaq while other companies rose on broader economic optimism.

The Dow Jones Industrial Average rose 0.29%, while the S&P 500 lost 0.03% and the Nasdaq Composite dropped 0.58%.

But while investors eyed inflation, minutes from the January Fed meeting showed policymakers willing to push further accommodation to boost the pandemic-scarred U.S. economy.

Persistent optimism spread to the U.S. dollar, which rose against other currencies. The dollar index, a measure of the currency's strength against six other major currencies was last 0.25% higher.

The risk-on appetite was also apparent in bitcoin, which continued its upward march to exceed $52,000 amid signs it may be gaining more mainstream acceptance.

An ongoing deep freeze in Texas continued to drive up oil prices, as the unusually cold weather hampered output at the largest U.S. crude producing state. Brent crude gained 1.6%, while U.S. West Texas Intermediate (WTI) crude settled up 1.8%, both levels not seen since January 2020.

Safe-haven U.S. Treasury yields were down slightly Wednesday amid the stronger economic data. The benchmark 10-year yield, which touched 1.333%, its highest level since Feb. 27, 2020, later dropped to 1.2720%. The 30-year U.S. yield also dropped.

Spot gold edged 0.2% lower to $1,815.80 per ounce pressured by higher benchmark U.S. Treasury yields. U.S. gold futures fell 0.4% to $1,815.70 per ounce.

(Reporting by Pete Schroeder; editing by Richard Pullin)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Updated Date:

TAGS:

also read

France, Germany to agree to NATO role against Islamic State - sources
| Reuters
World

France, Germany to agree to NATO role against Islamic State - sources | Reuters

By Robin Emmott and John Irish | BRUSSELS/PARIS BRUSSELS/PARIS France and Germany will agree to a U.S. plan for NATO to take a bigger role in the fight against Islamic militants at a meeting with President Donald Trump on Thursday, but insist the move is purely symbolic, four senior European diplomats said.The decision to allow the North Atlantic Treaty Organization to join the coalition against Islamic State in Syria and Iraq follows weeks of pressure on the two allies, who are wary of NATO confronting Russia in Syria and of alienating Arab countries who see NATO as pushing a pro-Western agenda."NATO as an institution will join the coalition," said one senior diplomat involved in the discussions. "The question is whether this just a symbolic gesture to the United States

China's Xi says navy should become world class
| Reuters
World

China's Xi says navy should become world class | Reuters

BEIJING Chinese President Xi Jinping on Wednesday called for greater efforts to make the country's navy a world class one, strong in operations on, below and above the surface, as it steps up its ability to project power far from its shores.China's navy has taken an increasingly prominent role in recent months, with a rising star admiral taking command, its first aircraft carrier sailing around self-ruled Taiwan and a new aircraft carrier launched last month.With President Donald Trump promising a US shipbuilding spree and unnerving Beijing with his unpredictable approach on hot button issues including Taiwan and the South and East China Seas, China is pushing to narrow the gap with the U.S. Navy.Inspecting navy headquarters, Xi said the navy should "aim for the top ranks in the world", the Defence Ministry said in a statement about his visit."Building a strong and modern navy is an important mark of a top ranking global military," the ministry paraphrased Xi as saying.