London — Investors have shrugged off US President Donald Trump’s record second impeachment and focused instead on reports on Thursday that his replacement, Joe Biden, will lay out a new US $2-trillion stimulus programme later.
Luca Paolini, chief strategist at Pictet Asset Management, said an ongoing rise in borrowing rates could unsettle markets if they start to accelerate. “It could be a bit difficult. Though I would rather have the US Fedeal Reserve hiking rates, bond yields at 4%, growth at 5%, rather than everything at zero, because it’s more sustainable.”There was plenty of action overnight in Asia too. Japan’s Nikkei hit its highest level since August 1990 taking its surge since late October to 25%.
The Hong Kong-listed shares of Chinese tech giants Alibaba, Tencent and Baidu all rose sharply after sources told Reuters and the Wall Street Journal that plans to extend a US investment ban to the stocks had been scrapped. In commodity markets, oil futures nursed modest losses as fresh surges in coronavirus cases stoke worries about more lockdowns and lower energy demand. Brent crude futures were down 0.5% at $55.75 a barrel and US crude futures were at $52.70.
“The number one question for global markets and equities will be when the Fed will start tapering,” said Frank Benzimra, head of Asia equity strategy at Société Générale in Hong Kong. “This is where you can get some concern ... but at the moment it is something that is a bit premature.”