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(Bloomberg) – US futures have soared with Asian stocks as President-elect Joe Biden reportedly has a clearer path to boost fiscal stimulus after key elections. Treasury bills posted losses on fears of an increasing debt burden and the risk of faster inflation.
A gauge of Asia-Pacific stocks was on track for another record Thursday, while S&P 500 and Nasdaq 100 futures also rose. The Democrats’ victory in two main ballots in Georgia gives them control of the US Senate and has reignited the so-called reflation trade that bets on a global resumption of the pandemic.
Previously, the S&P 500 had slashed a 1.5% lead, but still closed in the green, after protesters stormed the U.S. Capitol. Calm was then restored. Elsewhere, the dollar has risen. Oil and gold have changed little.
Hong Kong missed the rally in Asia, weighed down by declines in Alibaba Group Holding Ltd. and Tencent Holdings Ltd. after reports that the Trump administration may ban investments in China’s two most valuable companies. The New York Stock Exchange’s plan to pull three major Chinese telecommunications companies also sapped sentiment.
Investors focused on the political implications of the Democrats’ takeover of the U.S. Senate, as lawmakers resumed the politically charged process of ratifying Biden’s presidential victory. Hours earlier, a pro-Trump mob had stormed the U.S. Capitol and chased lawmakers from their chambers.
Equity markets in Asia appeared to look past the turmoil and chose “to focus on the prospect of further stimulus from the result in Georgia,” said Shane Oliver, chief investment officer and economist in Georgia. chief at AMP Capital.
In the final minutes released on Wednesday, the Federal Open Market Committee issued instructions that it would continue to buy bonds at least at its current rate until the economic recovery has made “further substantial progress.”
Meanwhile, shares of Twitter Inc. fell after hours after the platform suspended President Donald Trump’s account for pushing a violent crowd that stormed the Capitol building.
Here are some of the main movements in the markets:
Stocks
Futures on S&P 500 rose 0.7% at 6:50 a.m. in London. The S&P 500 index gained 0.6%. The Japanese Topix index climbed 1.7%. The Australian S & P / ASX 200 index climbed 1.6%. South Korea’s Kospi index rose 2.1%. Hong Kong’s Hang Seng Index fell 0.5%. 50 futures contracts rose 0.3%.
Currencies
The yen was at 103.21 per dollar, down 0.2%. The offshore yuan was trading at 6.4393 to the dollar. The Bloomberg Dollar Spot Index climbed less than 0.1%. The euro was at $ 1.2322.
Obligations
The yield on 10-year Treasury bills rose one basis point to 1.05% after rising eight basis points. The yield on Australian 10-year bonds rose two basis points to 1.09%.
Basic products
West Texas Intermediate crude rose 0.9% to $ 51.09 per barrel, while gold rose 0.3% to $ 1,925.27 per ounce.
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