Stock Markets Continued to Soar As Traders Anticipate Vaccine Roll-Out

NYSE

Key Points

  • Equities plummeted worldwide Monday after the blockbuster rally in November while the Dow had its strongest month in nearly 34 years in reaction to a stronger-than-predicted performance from a variety of coronavirus vaccines and expectations they will start to roll out before the turn of the year.
  • Tokyo, Sydney, Seoul, Taipei, Jakarta, and Bangkok jumped more than one percent, while Shanghai led gains, rising 1.8 percent. Manila has increased by over three percent.
  • The spread of the infection creates the greatest discomfort when the US experiences a massive rise in outbreaks, and within weeks after millions of Americans traveled over Thanksgiving, President Donald Trump’s top infectious disease specialist warns of a fresh wave.
  • Visit The Financial Today’s homepage for more stories.

HONG KONG — Markets soared Tuesday, with vaccine-driven buyers resuming their buying streak, while the spectrum for the new virus outbreaks held traders under check.

Analysts said the possibility of millions of people getting vaccines in the coming weeks would allow traders to bet on a strong global economic recovery next year.

Equities plummeted worldwide Monday after the blockbuster rally in November while the Dow had its strongest month in nearly 34 years in reaction to a stronger-than-predicted performance from a variety of coronavirus vaccines and expectations they will start to roll out before the turn of the year.

News that Chinese manufacturing output had hit a 10-year record added to the positive mood.

“I feel pretty confident that portfolios should be positioned for continued good performance from equity markets as we head into 2021,” Chris Iggo, at AXA Investment Managers, said.

Tokyo, Sydney, Seoul, Taipei, Jakarta, and Bangkok jumped more than one percent, while Shanghai led gains, rising 1.8 percent. Manila has increased by over three percent.

After dipping more than two percent, Hong Kong climbed 0.9 percent as the city sees a fresh surge in infections that has prompted leaders to reinstate containment initiatives, though advances have also been enjoyed by Mumbai and Singapore.

London, Paris, and Frankfurt have started with good gains.

“Flashing green lights at the end of the tunnel suggest investors should look through the immediate COVID-19 concerns and focus on the future, which seems incredibly bright and bullish,” said Axi’s Stephen Innes.

However, he added a word of warning that “one cannot be certain what the landscape will look like on the other side.”

The spread of the infection creates the greatest discomfort when the US experiences a massive rise in outbreaks, and within weeks after millions of Americans traveled over Thanksgiving, President Donald Trump’s top infectious disease specialist warns of a fresh wave.

Federal Reserve chief Jerome Powell cautioned: “The rise in new Covid-19 cases, both here and abroad, is concerning and could prove challenging for the next few months.”

Powell also told the Senate Banking Committee: “A full economic recovery is unlikely until people are confident that it is safe to reengage in a broad range of activities.”

Oil prices have dropped again as markets are worried about a lack of news in talks between OPEC and other top producers about extending supply cuts, just as the increase in new infections fuels worries about another demand hit.

Since pushing past its previous peak Monday, Bitcoin was closing in on $20,000.

The cryptocurrency surpassed $19,857, exceeding its previous all-time high set just before Christmas 2017, after a breakneck surge that was quickly followed by an equally fast drop.

Bloomberg News & AFP contributed to this story. Image by Bogdan Tapu.

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