Asian Equites Edge Up As Biden Spending Plan Boosts U.S. Outlook

01/04/2021 Markets in Asia rose on Thursday as investors parsed the details of a $2 trillion U.S. government spending plan and hoped for strong jobs data later in the week. Hong Kong lead the gains, after data signalled regional manufacturing picked up – Tencent 4.45% stronger in greenland. U.S equity futures firmer and European futures edged up. Nasdaq, the tech-heavy U.S. index rallied overnight, beating the S&P 500. Ten-year Treasury yields dipped after sealing the worst quarterly performance since 1980 – Bloomberg Barclays index tracking U.S. government bonds. Oil gained ahead of a high-stakes OPEC+ meeting, later on Thursday, that will debate whether to extend supply curbs. The dollar ticked higher. Bonds trimmed losses.

The All-share lost 1.2% to 66,485 points and the Top 40 1.15% as JSE tracked most of its global peers weaker. Investors turned to developments around US stimulus spending plans for direction. Financials and banks both fell 2.23%, industrials 1.47% and retailers 1.39%. The local market is likely to benefit from some optimism in Asian markets as regional data, PMIs – Hong Kong, China, Indonesia, Malaysia; all came in line and better than expected in some cases. The All-Share index gained 11.91% for the quarter-to-date.

European stocks finished below the waterline, with little in the way of corporate news to drive markets, as investors mulled the latest UK GDP reading. The pan-European Stoxx 600 was down 0.24%, with the UK’s FTSE 100 erasing 0.86%, Germany’s Dax on the other hand was roughly flat at 15,008.34. Deliveroo, competitor to Just Eat Takeaway and Delivery Hero, opened well below the IPO price. The share price was down as much as a third to 275pence – Deliveroo was priced at 390.0p per share, valuing the company at £7.6bn.

Wall Street closed mixed, with the S&P500 hitting intraday record high as Biden was set to reveal his $2trn infrastructure spending plan. The Dow was down 0.26%, while the S&P 500 managed gains of 0.36% and the Nasdaq Composite rose 1.54%. U.S. equities were buoyed on gains from the likes of tech-heavyweights Apple Inc., Microsoft Corp. and Tesla Inc.
Economic Data:-
• Initial jobless claims, week ended March 27: 675,000 expected vs. 684,000 during the prior week
• Continuing claims, week ended March 20: 3.750 million expected and 3.870 million during the prior week
The latest jobless claims report is expected to bring new claims down to the lowest level since the start of the pandemic.

MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.59%. Japan’s Nikkei rose 0.82% as a survey showed PMI data came out better than expected at 52.7 vs 52.0, bouncing back to pre-pandemic levels. China stocks rose, led by consumer and healthcare shares, investors shrugging weaker-than-expected factory activity growth PMI 50.6 vs 50.9. The Shanghai Composite 0.87 firmer, alongside the Hanh Seng gaining 1.60%. Australian ASX 200 0.56% higher on Thursday, wrapping up the holiday-shortened week on a firm note as investor cheered an end to Brisbane lockdown ahead of the long Easter weekend.

Brent crude for June delivery was up by 43 cents, or 097%, at $63.27. U.S. WTI was up 61 cents, or 1.10%, at $59.80 a barrel. Ministers from OPEC, and allies including Russia and Kazakhstan, meet later on Thursday to consider options that include an output roll-over and a gradual output increase.