Asian Stock Market: Covid woes probe bulls ahead of US NFP

Asian equities track Wall Street’s mild gains but virus concerns roil the mood.
China, Australia and New Zealand flashes upbeat signals but can’t bean pre-NFP caution.
Vaccine hopes, receding expectations of tapering join upbeat early signals of US jobs report to back the bulls.
Japan is up for extending and expanding emergency, India marks fresh record infections.

Anil Panchal FXStreet

Asian shares edge higher amid hopes of upbeat US jobs report, as well as faster vaccinations, during early Friday. However, cautious sentiment tames the bullish performance as the coronavirus (COVID-19) worries escalate in Japan and India. That said, MSCI’s index of Asia-Pacific shares outside Japan rises 0.65% whereas Japan’s Nikkei 225 prints 0.12% intraday gain by the press time of the pre-European session.

Following the US and the European Union’s (EU) support to waive off the covid vaccine patents, hopes of faster jabbing swirl, which in turn boosts the market’s mood. Following that the US Federal Reserve (Fed) policymakers rejected the rate hike chatters while early signals for today’s American jobs report for April also came in upbeat.

Amid these plays, all three key benchmarks of Wall Street closed in the positive territory for the first time this week and the risk-on mood helped Asia-Pacific markets as well. On the positive side for Asia could be an upbeat RBA Monetary Policy Statement, strong China trade and PMI, as well as firmer RBNZ Inflation expectations.

Meanwhile, Indian refreshes the all-time high of covid infections with 414,188 the latest figures whereas Japan looks set to extend and expand the third national emergency towards May 30. Also on the risk-negative side could be Aussie-China tussles.

Stocks in China remains mildly bid and those from Australia, Hong Kong and South Korea follow the suit. However, India’s BSE Sensex jumps over 0.60% amid hopes of a 1.0 trillion rupees pandemic pool whereas New Zealand’s NZX 50 drops 0.66% as firm inflation signals a sooner recall of the RBNZ’s easy money policies.

It should be noted that the stock futures track Wall Street to the north but the US 10-year Treasury yield and US dollar index (DXY) seesaw as traders turn cautious ahead of the key US event, namely monthly employment report.

Read: US April Nonfarm Payrolls Preview: Leading indicators point to another strong NFP

Author

Anil Panchal

FXStreet

Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.

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