Asian stocks follow Wall Street higher on vaccine hopes

Asian stock markets followed Wall Street higher Thursday as hopes for development of a coronavirus vaccine competed with concern about rising U.S. infections.

Currency traders watch monitors at the foreign exchange dealing room of the KEB Hana Bank headquarters in Seoul, South Korea, Thursday, July 2, 2020. Asian stock markets followed Wall Street higher Thursday as hopes for development of a coronavirus vaccine competed with concern about rising U.S. infections. (AP Photo/Ahn Young-joon)

Benchmarks in Shanghai, Tokyo, Hong Kong and Australia all advanced.

Investors were encouraged after Pfizer and BioNtech announced preliminary data from a vaccine test, one of a series being carried out by global developers.

At the same time, the populous American states of California and Texas reported daily record highs in new cases.

“Vaccine hopes, while welcome, fall short of guaranteeing a V-shaped recovery,” said Mizuho Bank in a report.

The Shanghai Composite Index rose 0.7% to 3,048.68 and the Nikkei 225 in Tokyo added 0.6% to 22,266.23. The Hang Seng in Hong Kong, reopening after a holiday, gained 1.5% to 24,803.24.

In South Korea, the Kospi advanced 0.8% to 2,124.68 while Australia’s S&P-ASX 200 added 1.1% to 5,997.50. New Zealand, Singapore and Jakarta also rose.

On Wall Street, the benchmark S&P 500 index rose 0.5% on Wednesday to 3,115.86, boosted by gains for technology companies.

The Dow Jones Industrial Average lost 0.3% to 25,734.97. The Nasdaq composite, which is heavily weighted with technology companies, climbed 1% to a record 10,154.63.

Stock markets around the world roared back last quarter on hopes economies are pulling out of their deepest slump since the 1930s. Analysts warn, however, that prices might be rising too far and too fast to be supported by economic activity when infections are rising in the United States, Brazil and some other countries.

In the United States, a report on manufacturing showed activity returned to growth in June, a much better reading than the contraction economists expected.

Earlier, a separate report suggested private employers hired more workers than they cut in June.

“It is still a guessing game as to how the Covid-19 lingering impact will sustain,” said Jingyi Pan of IG in a report.

In China, two surveys this week showed manufacturing improved in June, adding to signs of a gradual recovery.

A similar survey for the 19-country eurozone showed manufacturing almost growing again after widespread shutdowns.

Analysts said that while the data pointed in the right direction, it shows that an economic recovery from the pandemic will be slow.

In energy markets, benchmark U.S. crude lost 1 cent to $39.81 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose 55 cents to settle at $39.82 on Wednesday. Brent crude, the international price standard, gained 2 cents to $42.05 per barrel in London. The contract rose 76 cents the previous session to $42.03 a barrel.

The dollar gained to 107.53 yen from Wednesday’s 107.49 yen. The euro rose to $1.1261 from $1.1244.

- Associated Press

Source: Peso Economics