World Shares Higher After Wall St Rally05/28 05:48
Global markets were mostly higher on Thursday as investors pinned their
hopes on an economic rebound from the coronavirus pandemic.
BANGKOK (AP) -- Global markets were mostly higher on Thursday as investors
pinned their hopes on an economic rebound from the coronavirus pandemic.
Shares rose in Paris, London and Tokyo but dropped in Hong Kong, where
tensions are flaring over Beijing's effort to exert more control over the
former British colony.
Germany's DAX gained 0.7% to 11,740.63 and the CAC 40 in Paris climbed 0.8%
to 4,722.51. Britain's FTSE 100 picked up 0.6% to 6,179.70. The future for the
S&P 500 was up 0.1% while the future for the Dow industrials gained 0.4%,
auguring early gains on Wall Street.
The most recent developments over Hong Kong are another thorn in a
relationship already testy over China's handling of the early stages of the
coronavirus outbreaks and other antagonisms.
Two pro-democracy lawmakers were ejected from Hong Kong's legislative
chamber Thursday morning, at the start of a second day of debate on a
contentious bill that would criminalize insulting or abusing the Chinese
China's ceremonial legislature approved a national security law Thursday,
overriding protests from critics who say it could further undercut
semi-autonomous Hong Kong's civil liberties.
On Wednesday, U.S. Secretary of State Mike Pompeo told Congress the Trump
administration no longer regards Hong Kong as autonomous from mainland China.
That sets the stage for the U.S. to withdraw the preferential trade and
financial status Hong Kong has held since it reverted to Chinese rule 23 years
While Hong Kong's role as regional trading center and financial hub has been
to a large extent sidelined by developments on the Chinese mainland, removing
its special status would be a huge blow to businesses located in the city
because of its independent financial and legal systems.
With U.S. Commerce Secretary Wilbur Ross saying President Donald Trump has a
"'whole menu' of options, the market is on edge to hear exactly what those
measures are, and how China absorbs them," Chris Weston of Pepperstone said in
"This is a risk for markets and the situation is clearly fluid one
questions if the equity markets are too complacent here?" Weston said.
Hong Kong's Hang Seng index lost 0.7% to 23,132.76, while the Shanghai
Composite index gained 0.3% 2,846.22.
Tokyo's Nikkei 225 index jumped 2.3% to 21,916.31, lifted by the latest,
$1.1 trillion, infusion of stimulus for Japan's moribund economy. India's
Sensex gained 1.6% to 32,114.81, despite news of another record increase in the
number of new coronavirus cases. The S&P/ASX 200 in Sydney climbed 1.3% to
South Korea's Kospi edged 0.1% lower after health authorities reported 79
new cases of coronavirus in the latest setback for the country's recovery from
That news undid any boost from the South Korean central bank's decision to
lower its policy rate to an all-time low of 0.5% to soften the pandemic's shock
to the country's trade-dependent economy.
The Bank of Korea has said the economy may shrink for the first time in 22
years. Its rate cut followed another two months ago, which was its first since
U.S. shares advanced overnight, with the S&P 500 closing over 3,000 points
for the first time since early March. Financial, industrial, department store
chains and health care stocks accounted for a big slice of the gains.
The benchmark S&P 500 ended a choppy day of trading up 1.5% at 3,036.13. The
Dow Jones Industrial Average jumped 2.2%, to 25,548.27, its first close above
25,000 points since March.
"A steady stream of economic revival indications underpinned the latest
rally on Wall Street, inducing the market to brush aside simmering tensions
between the U.S. and China," Jingyi Pan of IG said in a commentary.
The S&P 500 is now down only 10.3% from its record high in February, before
it plunged nearly 34% in March on sell-offs propelled by worries over the
Gains first driven by massive stimulus from the Federal Reserve and Capitol
Hill have accelerated recently on hopes growth will revive as governments ease
up on business-shutdown orders meant to slow the spread of the coronavirus.
In other trading, bond yields were mixed. The yield on the 10-year Treasury
slipped to 0.67% from 0.69% late Wednesday.
U.S. crude oil for delivery in July lost 91 cents to $31.90 per barrel in
electronic trading on the New York Mercantile Exchange. It fell $1.54 on
Wednesday to settle at $32.81 per barrel.
July Brent crude, the international standard, gave up 80 cents to $34.65 per
The dollar bought 107.76 Japanese yen, up from 107.72 yen late Wednesday.
The euro slipped to $1.1003 from $1.1006.