- Asian shares trim early day gains, MSCI stays near record high.
- More Chinese companies get out of the global indices, Australia to approach WTO over trade tussle with Beijing.
- US stimulus talks stretched to the next day, covid vaccine approvals continue.
- New Zealand’s HYEFU prints upbeat economic outlook, Japan’s trade surplus eases.
Asian stocks trim initial gains but remain upbeat while heading into the European session on Wednesday. The risks follow Wall Street benchmarks amid welcome news concerning the coronavirus (COVID-19) vaccine and the US covid stimulus. However, a light calendar and the virus wave 2.0 probes the bulls ahead of the Fed.
Read: Wall Street Close: Apple boosts Wall Street, stimulus optimism lives on
While portraying the mood, MSCI’s index of Asia-Pacific shares outside Japan rises around 0.70%, snaps a two-day downtrend, whereas Japan’s Nikkei 225 gains 0.20% after the initial upside jump of above 1.0%.
Australia’s ASX 200 and New Zealand’s NZX 50 ignore the Western fight with their biggest customer China while marking nearly 0.70% intraday gains. Not only the US indices like S&P, DJI and MSCI’s delisting of Chinese companies but Aussie run to complain the World Trade Organization (WTO) also mark the escalation of trade and political tension surrounding Beijing. On the positive side, New Zealand (NZ) Treasury’s Half-Year Economic and Fiscal Update (HYEFU) flashed an upbeat forecast while Japan’s Merchandise Trade Total eases below ¥529.8B forecasts to ¥366.8B.in November.
Elsewhere, the UK, the US and Europe are up for more local lockdowns whereas Japan’s Tokyo is also witnessing the bitter phase of wave 2.0. However, the fast approvals of covid vaccines and/or development of the first at-home testing battle the virus woes.
It should be noted that the US policymakers are inching closer to the much-awaited stimulus and so the UK-EU diplomats who are battling Brexit for long.
Against this backdrop, S&P 500 Futures print mild losses amid market consolidation and cautious mood during the pre-Fed session. Furthermore, stocks in China, Hong Kong, South Korea and India are mostly up half a percent whereas Indonesia’s ISX Composite rises near 1.5% by press time.
Looking forward, US stimulus headlines will join the Fed’s move to direct near-term market sentiment.
Read: Federal Reserve Preview: How a dose of economic Christmas cheer could spoil the market mood
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