Asian stocks gain on hopes pandemic is approaching peak
Asian shares rose on Thursday on hopes the COVID-19 pandemic is nearing a peak and that governments would roll out more stimulus measures, while expectations of an oil production cut agreement bolstered crude prices.
MSCI’s broadest index of Asia-Pacific shares outside Japan was up 0.6%, following a strong Wall Street close.
Shares in China, where the novel coronavirus first emerged late last year, rose 0.54%. Australian shares were up 1.52%.
Oil prices extended gains on hopes major producers will cut output at a meeting later in the day in response to a collapse in global oil demand.
New York Governor Andrew Cuomo said the state’s efforts at social distancing were working in getting the virus under control in one of the biggest hot spots in the United States.
U.S. President Donald Trump said he would like to reopen the U.S. economy with a “big bang” but that the death toll from the coronavirus first needs to be heading down.
The S&P 500 gained 3.41% on Wednesday, helped by hopes the pandemic was nearing its peak. However, U.S. stock futures gave up earlier gains to be down 0.27%
The Trump administration has asked lawmakers for an additional $250 billion in aid for small U.S. businesses.
However, congressional efforts were stalling as Democrats held out for similar amounts of aid for hospitals and local governments.
Wall Street rallied on Trump’s optimism though recent U.S. data and forecasts are only now beginning to reflect the economic damage.
McDonald’s Corp said global comparable sales tumbled 22.2% in March, while Starbucks Corp forecast a 47% drop in second-quarter earnings.
Japan’s Nikkei stock index bucked the regional trend and fell 0.55% as coronavirus infections in the country rose and following the government’s declaration of a state of emergency for Tokyo and other urban areas.
The euro nursed losses against the dollar and the pound after euro zone finance ministers failed on Wednesday to agree on more support for their coronavirus-hit economies.
Sterling edged up for a third consecutive session. Helping confidence was news British Prime Minister Boris Johnson’s condition is improving and he is able to sit up in bed and engage with clinical staff.
Johnson is in intensive care battling COVID-19.
U.S. crude rose 4.58% to $26.24 a barrel. Brent crude rose 2.5% to $33.71 per barrel.
The Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia – a group known as OPEC+ – are set to convene a video conference meeting on Thursday.