SYDNEY (Reuters) – Asian stocks rose on Monday as concerns over rising cases of COVID-19 and delayed vaccine supply stemmed from expectations of a $ 1.9 trillion fiscal stimulus plan to help revive the US economy.
Global equity markets have placed bets at record highs in recent times as the COVID vaccines begin to reduce worldwide inflation rates and a strong US economic recovery under President Joe Biden.
Nevertheless, investors are concerned about the answers to questions asked about the efficiency of vaccines to curb the epidemic and USlawmakers continue to debate a coronavirus assistance package.
MSCI’s largest index of Asia-Pacific shares outside Japan rose slightly from 721.96 and is only a short distance from last week’s record high of 727.31.
The benchmark is up 8.5% in January, on track for its straight monthly growth.
Japan’s Nikkei was up 0.36% in early trade.
Australian shares were slightly higher after the country’s drug regulator approved the Pfizer / BioNTech COVID-19 vaccine. Officials said the phased rollout will begin at the end of next month.
Chinese stocks rose, with the blue-chip CSI300 index gaining 0.6%.
“The spotlight will be in Washington DC this week,” said Stephen Innes, chief global market strategist.
The Biden administration tried to counter Republican concerns that his $ 1.9 trillion pandemic relief proposal was too costly with lawmakers from both parties, saying they agreed that Americans should be a priority to receive the COVID-19 vaccine.
Financial markets are largely eyeing US economic stimulus, though disagreements mean that there are months of indecision in more than 175,000 COVID-19 cases in a country with millions out of work.
“Vaccine successes make it likely that life will become more functional again at some point in 2021, resulting in higher GDP growth and more robust corporate income,” Ince said.
“But rising global COVID19 infections, new forms of the virus, tightening of social disturbance restrictions and delaying vaccine rollout in some locations all increase the risk of near-term development.”
Global COVID-19 cases are moving towards 100 million with more than 2 million dead.
Hong Kong closed an area of the Kowloon Peninsula on Saturday, the first such measure in the city since the epidemic began.
The report of the new UK COVID variant was not only highly contagious, but perhaps even more fatal than the original strain, adding to the concerns.
In the European Union, political leaders expressed widespread disagreement in fulfilling the promises made by AstraZeneca and Pfizer Inc., with the Italian Prime Minister calling for the exclusion of the vaccine suppliers, which said serious violations of contractual obligations The reason is delayed.
On Friday, the Dow lost 0.57%, the S&P 500 lost 0.30% and the Nasdaq lost 0.09%. The three main US indices closed higher for the week, with the Nasdaq up more than 4%.
Jefferies analysts said the US stock market appeared to be overvalued, although they still remain bullish.
Analyst Christopher Wood said, “Instead of bull market correction for the stock market is a real bad time, there needs to be a catalyst.”
“That means either an economic downturn or tightening material in Fed policy,” Wood said, adding that neither was likely to happen in a hurry.
In currencies, the major pairs were stuck in a tight range as the markets awaited the US Federal Reserve meeting on Wednesday.
The dollar index was flat at $ 90.19, with the euro at $ 1.2169, while sterling was last traded at $ 1.3691.
The Japanese yen was unchanged at 103.77 per dollar.
In commodities, oil prices fell with Brent to close at $ 12.24 a barrel and US crude by 3 cents to close at $ 52.24.
Gold spot prices rose 0.2% to 1,855.9 per ounce.
Editing by Sam Holmes and Mr. Navratnam