Slowing virus, China stimulus hopes support stocks, yen nurses losses

By Tom Westbrook SINGAPORE (Reuters) - Asian stocks edged up on Thursday, supported by a fall in coronavirus cases and expectations of more Chinese stimulus to offset the economic impact of the epidemic, while the Japanese yen nursed heavy losses after suffering its steepest drop in six months. The epicentre of the outbreak in China's Hubei reported just 349 new cases on Thursday, the lowest since Jan. 25, although it was accompanied by a change in diagnosis rules

Reuters February 20, 2020 07:05:18 IST
Slowing virus, China stimulus hopes support stocks, yen nurses losses

Slowing virus China stimulus hopes support stocks yen nurses losses

By Tom Westbrook

SINGAPORE (Reuters) - Asian stocks edged up on Thursday, supported by a fall in coronavirus cases and expectations of more Chinese stimulus to offset the economic impact of the epidemic, while the Japanese yen nursed heavy losses after suffering its steepest drop in six months.

The epicentre of the outbreak in China's Hubei reported just 349 new cases on Thursday, the lowest since Jan. 25, although it was accompanied by a change in diagnosis rules.

China is widely expected to cut its benchmark lending rate on Thursday, adding to a slew of fiscal and monetary measures in recent weeks aimed at cushioning the virus' impact on the economy.

China also plans to take over HNA Group and sell off its airline assets, Bloomberg reported on Wednesday, citing people familiar with the matter.

MSCI's broadest index of Asia-Pacific shares outside Japan <.MIAPJ0000PUS> ticked up 0.1%.

Buoyed by the cheaper yen, Japan's Nikkei <.N225> rallied 1.5%. Markets in Australia and New Zealand minted record highs <.AXJO> <.NZ50>.

"The lowering of interest rates, cutting of corporate tax rates, increasing money supply...these are all seen as very strong responses" from China, said Michael McCarthy, chief market strategist at CMC Markets in Sydney.

The prospect of central bank support and easier money also underpinned bonds, with U.S. Treasury yields steady, with benchmark 10-year yields last at 1.5815% .

Overnight pan-regional STOXX 600 index <.STOXX> in Europe rose 0.8% to a record high. The Dow Jones <.DJI>, S&P 500 <.SPX> and Nasdaq <.IXIC> all gained. [.EU][.N]

More than 2,100 people have died from the coronavirus in China, spreading to more than two dozen countries, and governments around the world are trying to prevent it from becoming a global pandemic.

YEN TUMBLES

The most dramatic move overnight was a steep drop in the Japanese yen, which posted its sharpest fall against the dollar in half a year, even as safe-haven assets such as gold traded firmer.

Selling was broad and sustained through the session.

The yen fell nearly 1.4% against the dollar and the kiwi and almost 2% against the Norwegian krone - its sharpest daily drop against the krone in almost three years .

"It is rare to see USD/JPY and gold ripping at the same time, but the simple explanation is that the world is awash in a flood of money and there are not many attractive places to park that excess liquidity," said Brent Donnelly, Spot FX Trader at HSBC.

The yen recouped some of those losses in morning trade, to rise 0.2% to 111.17 per dollar.

Elsewhere oil prices held overnight gains, while gold gave some of its rise back.

U.S. crude last sat 30 cents firmer at $53.60 per barrel and Brent settled at $59.12 . Gold last traded at $1,609.33 per ounce .

(Editing by Shri Navaratnam)

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

Updated Date:

TAGS:

also read

Amazon union vote enters final stretch in watershed moment for U.S. labour
Business

Amazon union vote enters final stretch in watershed moment for U.S. labour

By Mike Spector and Jeffrey Dastin (Reuters) - The National Labor Relations Board has begun reviewing ballots from Amazon.com Inc's workers in Alabama, who have voted on whether to form a union, with momentum for future labour organizing at America's second-largest private employer hanging in the balance. Agents from the labour board began sifting through ballots sent to more than 5,800 workers at Amazon's Bessemer, Alabama-based warehouse at 10 a.m

Spotify buys Locker Room app's maker Betty Labs in live audio push
News &amp; Analysis

Spotify buys Locker Room app's maker Betty Labs in live audio push

By Elizabeth Culliford NEW YORK (Reuters) - Spotify Inc said on Tuesday it has purchased Betty Labs, the company behind sports-focused social audio app Locker Room, to accelerate its move into live audio. New voice-based platforms, including invite-only social app Clubhouse, have seen rapid growth in recent months during the COVID-19 pandemic.

Oil falls as Suez Canal opens, dollar rallies; eyes on OPEC+ meeting
Business

Oil falls as Suez Canal opens, dollar rallies; eyes on OPEC+ meeting

By Devika Krishna Kumar NEW YORK (Reuters) - Oil prices slid on Tuesday as the Suez Canal reopened to traffic and the dollar rallied, while focus turned to an OPEC+ meeting this week, where analysts expect an extension to supply curbs to offset dim demand prospects. Brent crude fell $1.20, or 1.9%, at $63.78 a barrel by 1:12 p.m.