Asian stock market: Bulls cheer Japanese traders’ return despite US-China tension

Asian equities print gains as traders in Tokyo return from extended weekend.
Hopes of further stimulus from the US, no change in the Sino-American trade deal favor the bulls.
Economic calendar stays quiet but risk factors are worth watching.

Shares in Asia rise the most in one week after witnessing a bumpy start on Monday. To portray the same, MSCI’s index of Asia-Pacific shares outside Japan prints 0.92% gains while Japan’s Nikkei 225 surges over 1.85% to 22,745 ahead of Tuesday’s European session.

With the economic calendar be mostly quiet, except for downbeat Singapore GDP and Australian Payroll update, market sentiment relies on the qualitative catalysts. In doing so, the reduction in the US hospitalization for the first time in a week joins upbeat comments from the People’s Bank of China (PBOC) Governor to portray the risk-on momentum. Also supporting the mood could be the Japanese traders’ reaction to the recently increasing expectations of the US coronavirus (COVID-19) phase 4 stimulus package.

As a result, the traders pay a little heed to the Sino-American tension that recently announced the US attempts to raise bars for Chinese securities’ listings and terming Hong Kong goods as “made in China”.

While portraying the mood, ASX 200 gains 0.50% to 6,140 but New Zealand’s NZX 50 losses the same amount ahead of the key RBNZ that bears downbeat consensus. Further, Hong Kong’s Hang Seng becomes the market leader with 2.50% of gains to 24,987 whereas India’s BSE Sensex, South Korea’s KOSPI and Indonesia’s IDX Composite follow the order with receding gains.

It should also be noted that the US 10-year Treasury yields also print the market optimism while rising 1.1 basis points (bps) to 0.585% while S&P 500 Futures add 0.28% gains to 3,362 by the time of writing.

Considering the lack of major data/events, other than the UK employment data and the US Producers Price Index, market players will keep eyes on the US-China headlines and stimulus news for fresh impulse.

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