SYDNEY (Reuters) – Asian stocks consolidated Monday on renewed hopes for a coronavirus vaccine after AstraZeneca resumed its Phase 3 process, though sentiment was still cautious ahead of a big week of central bank meetings in the United Kingdom, Japan and the United States.
In one sign the positive mood will spread elsewhere, the pan-region Euro Stoxx 50 futures STXEc1
Futures on US stocks, e-mini S&P 500 ESc1, jumped 1.3% after a mixed session on Wall Street last week.
Most major markets across Asia were positive with the broadest MSCI Asia Pacific Equity Index outside of Japan .MIAPJ0000PUS up 0.9% for its second consecutive earnings session.
Australian stocks .AXJO rose 0.6% while the Japanese Nikkei .N225 added 0.7%. Chinese equities started to rise, but reduced some of the early gains with the blue chip index .CSI300 last up to 0.1%.
Friday marked six months since the World Health Organization (WHO) declared the coronavirus a pandemic on 11 March.
Since then, major global economies have slipped into recession and millions of people have lost their jobs, prompting central banks around the world to launch unprecedented stimulus.
The bazooka of politics supported the financial markets with the S & P500 .SPX up 22%, 10-year Treasury yields fell 20.4 basis points and the greenback = USD sliding of 3.3%. The best performing major currency by far has been the Australian dollar AUD = D3, up 11.9%, thanks to a healthy appetite for risk.
“A really wild ride and one that is likely to continue as Phase 3 vaccine results start rolling out in the coming weeks,” NAB analyst Tapas Strickland said in a statement Monday.
AstraZeneca AZN.L said over the weekend that it resumed British clinical trials of its COVID-19 vaccine, one of the most advanced in development, after getting the green light from security watchdogs.
Late-stage trials of the experimental vaccine, developed with Oxford University researchers, were suspended last week after an illness in a study subject in Britain, casting doubt on early distribution.
A vaccine has long been awaited to help pull the world out of a coronavirus-induced blockade.
“The reopening of the global economy is urging us to recommend a swap along a basket of 14 lagging” back to work “stocks against a basket of 14 high-flying” COVID-19 winners “, BCA Research wrote in a statement.
“Although we maintain a cyclical and secular bullish outlook on the market overall, a short-term correction due to technical and (geo) political reasons is likely to be on the cards,” he said.
“Short-term playable retirement is needed.”
Later this week, the US Federal Reserve will hold its two-day policy meeting where it is expected to hold rates as it works out the previously announced move towards inflation targeting.
Additionally, “the Fed is set to be less preemptive in tightening policy than in the past,” NAB’s Strickland noted.
The Bank of Japan and the Bank of England will announce their respective policy decisions on Thursday.
Market attention will also be on the election of the new Japanese Prime Minister with the results of a party room vote expected at around 6.30 GMT.
Major currencies were trampling on Monday.
The dollar was slightly weaker against the yen at 106.06 JPY = although still a long way from its low this year of 101.2.
The euro EUR = it was unchanged at $ 1.1850. The Aussie AUD = D3 it was slightly weaker at $ 0.7283 while the pound was slightly above $ 1.2823.
In commodities, US crude CLc1 jumped 0.6% to $ 37.55 a barrel. Brent raw LCOc1 it was up 0.4% to $ 40 a barrel.
Gold was solid, with spot prices XAU = at $ 1,946.9 per ounce.
Swati Pandey reporting; Montage by Sam Holmes