Asian Stock Market: Struggles to justify policymakers’ battle with coronavirus

Asian equities trade mixed as virus resurgence tame vaccine hopes.
BOJ, RBA leaders indicate QE importance, Tokyo hints highest alert level.
Economics flash mixed signals, US Futures, T-yields stay depressed.

Anil Panchal FXStreet

Asian shares alternate gains with losses, mostly depressed, while heading into Wednesday’s European session. Recently firming coronavirus (COVID-19) grip in Asia-Pacific dims optimism that covid vaccines are coming stronger and sooner. While portraying the mood, MSCI’s index of Asia-Pacific shares, ex-Japan, prints 0.12% intraday gains that contrasts with 0.65% losses made by Japan’s Nikkei 225 so far today.

With the latest increase in Tokyo’s COVID-19 cases, Japan’s Chief Cabinet Secretary Kato Katsunobu signaled a move towards the highest alert level. Following that BOJ Governor Haruhiko Kuroda backs ultra-easy monetary policy.

It should also be noted that the RBA Governor Philip Lowe praised the Quantitative Easing (QE) during his latest appearance bout couldn’t weigh ASX 200, currently up 0.50% to 6,532.50. RBA’s Lowe also highlighted the importance to tame Canberra-Beijing tension. Recently, China warned Australia and Japan over a new defense pact, per ABC news.

New Zealand’s NZX 50 drops over 1.0% as fears of a fresh COVID-19 wave gains momentum whereas stocks in China and Hong Kong dribble over the Asian major’s ability to form the world’s biggest trade group.

Elsewhere, equities from South Korea and Indonesia prints mild gains amid a lack of fresh directions while Indian bourses are inching lower, initially with small losses, amid the on-going cautious sentiment.

US 10-year Treasury yields and S&P 500 Futures stay mildly offered as chatters over the coronavirus stimulus package deadlock regain market attention. Also weighing on American markets, also on the global trading sentiment, could be the second back-to-back weak US Retail Sales, 0.3% MoM in October.

With the virus woes regaining market attention and the vaccines are still away, global trade sentiment can depress further.

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.

EUR/USD looks to regain the 200-day SMA

EUR/USD regains some balance and trade just above 1.1600 the figure ahead of the opening bell in Asia. The pair initially dipped to the 1.1530 zone for the first time since November, always following the stronger US Dollar and the marked flight-to-safety in the context of the ongoing Middle East crisis

GBP/USD attacks 1.3300, refreshing three-month lows

GBP/USD is deep in the red near 1.3300, accelerating its downside to renew three-month lows in European trading on Tuesday. The ongoing escalation in the Iran war, combined with rising Oil prices, weighs negatively on the higher-yielding Pound Sterling as the US Dollar capitalizes on increased haven demand.

Gold bounces off lows, back above $5,100

Gold remains on the defensive, eroding part of the recent multi-day advance and managing to trade back above the $5,100 mark per troy ounce on Tuesday. The precious metal initially dropped just below the critical $5,000 threshold on the back of the persistent strength of the Greenback, higher US Treasury yields across the curve and investors' repricing of Fed rate cuts.