- Asian markets rallied Thursday as Joe Biden inched towards becoming the next US president, with investors now hoping lawmakers will soon pass a much-needed new stimulus package.
- Hong Kong and Jakarta each surged more than three percent, while Singapore, Seoul, Manila, and Bangkok jumped more than two percent.
- London opened higher as the Bank of England unveiled an extra £150 billion ($195 billion) in cash stimulus as it forecast a deeper recession than previously thought for the coronavirus-wracked UK economy.
- Visit The Financial Today’s homepage for more stories.
HONG KONG — Asian markets rallied Thursday as Joe Biden inched towards becoming the next US president, with investors now hoping lawmakers will soon pass a much-needed new stimulus package.
Traders brushed off Donald Trump’s claims of fraud and urgings to stop vote-counting by calling in lawyers, instead of taking heart from the failure of a Democratic sweep of Congress, which would have likely led to tax hikes and regulation.
While crucial battleground states remain close, the former vice president said he was confident that “when the count is finished, we believe we will be the winners.”
All three main indexes on Wall Street surged, with the Nasdaq soaring almost four percent as tech titans, including Apple and Facebook, breathed a sigh of relief.
“For financial markets, though, the result is a boon,” said Jeffrey Halley at OANDA.
“Gone will be a multi-trillion-dollar fiscal stimulus, it will come more monetary policy stimulus as the Federal Reserve takes the burden on its shoulders,” he added.
“Even if President Trump were to make a miraculous comeback, that status quo would be unchanged. It is, therefore, little surprise that US equity markets powered higher and the US Dollar quickly unwound all of its gains yesterday.”
However, Trump earlier claimed victory unilaterally and made clear he would not accept the reported results, issuing unprecedented complaints—unsupported by any evidence—of fraud.
“The damage has already been done to the integrity of our system, and to the Presidential Election itself,” he tweeted, alleging without proof or explanation that “secretly dumped ballots” had been added in Michigan.
Still, analysts said that while Trump’s court bids could cause some uncertainty, many investors were confident the uncertainty would not likely drag on.
Hong Kong and Jakarta each surged more than three percent, while Singapore, Seoul, Manila, and Bangkok jumped more than two percent.
Shanghai, Sydney, and Mumbai rallied more than one percent, and there were also gains in Wellington and Taipei.
Hopes for a new economic rescue package out of Washington were providing support to equities, even though any spending bill will not be as big as previously thought under a Democrat-run Congress.
With politicians going back to work on Monday, Republican Senate leader Mitch McConnell lifted hopes for a quick resolution, saying: “We need another rescue package.
“Hopefully, the partisan passions that prevented us from doing another rescue package will subside with the election. And I think we need to do it and I think we need to do it before the end of the year.”
And in a sign that the impasse that prevented agreement over the past few months was subsiding, he indicated he would be willing to look at cash for local and state governments, which was a key sticking point.
Dealers were also keeping tabs on coronavirus developments with England going into lockdown for a second time, joining France and other key European economies, though observers said they had largely been priced into markets now.
“Accelerating COVID cases and new shutdowns are obviously not good, but I think the market will quickly look past these new measures,” said Axi strategist Stephen Innes.
“Rolling shutdowns are part of the pandemic new normal, and most traders understand this will be a global feature until we get a vaccine or herd immunity.”
He added that vaccine hopes were also rising, with Britain and Germany possibly on course for a jab by the end of the year.
London opened higher as the Bank of England unveiled an extra £150 billion ($195 billion) in cash stimulus as it forecast a deeper recession than previously thought for the coronavirus-wracked UK economy.
Paris and Frankfurt also advanced.
Key Figures (0820 GMT)
Tokyo – Nikkei 225: UP 1.7 percent at 24,105.28 (close)
Hong Kong – Hang Seng: UP 3.3 percent at 25,695.92 (close)
Shanghai – Composite: UP 1.3 percent at 3,320.13 (close)
London – FTSE 100: UP 0.4 percent at 5,905.37
Euro/dollar: DOWN at $1.1738 from $1.1732 at 2230 GMT
Dollar/yen: DOWN at 104.43 yen from 104.50 yen
Pound/dollar: DOWN at $1.2950 from $1.2993
Euro/pound: UP at 90.64 pence from 90.27 pence
West Texas Intermediate: DOWN 1.9 percent at $38.39 per barrel
Brent North Sea crude: DOWN 1.9 percent at $40.45 per barrel
New York – Dow: UP 1.3 percent at 27,847.66 (close)
Image by Borm Laimkoo