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Fragmentary US stimulus hopes to boost stocks, Europe opens from Reuters




© Reuters. Men wearing protective masks chat in front of a screen showing the average Nikkei shares and world stock indices, during the coronavirus (COVID-19) epidemic, in Tokyo

By Swati Pandey

SYDNEY (Reuters) – An Asian equities indicator rose to a one-month high on Thursday on renewed hopes for more US stimulus as investors decided a key US political debate ahead of November̵

7;s elections hadn’t changed much Probabilities.

The broader MSCI Asia Pacific stock index outside of Japan rose 0.6% for its fourth consecutive session of earnings, to a level not seen since the beginning of September.

On Wednesday, a heavy political debate between Republican Vice President Mike Pence and his rival Democratic candidate Kamala Harris raised expectations for a tight US election next month that could lead to an unclear outcome and hurt equity markets.

However, US stock futures indicated further gains in store for the S&P 500. As European markets opened, London was up 0.3% and Germany’s 0.6%.

“It’s another good risk day and stocks have risen,” said Pepperstone strategist Chris Weston in Melbourne.

“Some tax talk has come back into play, but this has gotten tiring and the markets don’t need a reason to catch up, they just don’t need to hear bad news. So, in the absence of any, we see flying stocks and Treasuries. USA offered “.

Weston expects more monetary policy stimulus from the US Federal Reserve before Christmas if the fiscal package comes too small or too late.

The US tax package shift shocked both the dollar and US Treasuries this week.

Treasury yields fell on Wednesday on expectations of an aid package for airlines, small businesses and individuals after President Donald Trump scuppered talks over a full coronavirus-related stimulus in the previous session.

Meanwhile, new polls show Democratic candidate Joe Biden holding firm leadership against Trump ahead of the November election. Investors believe that if the Democrats took over the White House and both Houses of Congress, the fiscal stimulus would be implemented without much delay, which would support stocks and the dollar.

The Australian benchmark index jumped 1.1% to a one-month high helped by a larger-than-expected fiscal stimulus announced in the federal budget on Tuesday evening.

New Zealand equities rallied on expectations of further monetary policy easing after the country’s central bank said it was “actively considering” negative interest rates and a loan financing program.

added almost 1%.

Globally, risk assets have increased since mid-March amid a wave of central bank and government support for economies teetering from coronavirus-induced lockdowns around the world. Expectations of a more aggressive easing further strengthened sentiment.

All eyes will now be on US employment data forecast later in the day, which is likely to show recovery in the world’s largest economy which is losing strength.

Economists forecast a decline in jobless claims, however ongoing claims are expected to remain firmly above 10 million.

Despite the austere forecasts, Wall Street rallied overnight with the Dow up 1.9%, the S&P 500 up 1.7% and the Nasdaq up 1.88%.

In currencies, the dollar just moved against the yen at 106. The euro was also unchanged at $ 1.1778.

The Aussie dollar was 0.1% weaker at $ 0.7130.

In commodities, it was slightly weaker at $ 1,886 per ounce.

Oil prices were weaker due to the increase in crude oil inventories. [O/R]

futures fell 2 cents to $ 41.97 a barrel, while they dropped 2 cents to $ 39.87 a barrel.

(History trim to correct grammar in paragraph 3)




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