Asian stocks climb after Wall Street rally
Asian stocks started the week in positive territory this morning after an announcement from the US Food & Drug Administration (FDA) raised hopes of a coronavirus vaccine.
The FDA last night said it had authorised the use of blood plasma from recovered patients as a possible treatment for the virus.
The announcement came on the eve of the Republican National Convention, when Donald Trump will officially be nominated to lead his party for four more years.
Japan’s Nikkei reversed early losses to rise 0.4 per cent, while Chinese blue-chip CSI 300 index gained 0.8 per cent.
Sentiment was also bolstered by reports that Trump was seeking to bypass normal US regulatory rules to fasttrack a Covid-19 vaccine from the UK for use in the US.
“Markets are opening this morning to optimism on the therapeutics front after the FDA authorised the use of blood plasma from Covid-19 survivors to treat sick patients,” said Stephen Innes, chief global markets strategist at Axicorp.
“Not the Covid-19 cure all the world is hoping for, but it is another positive step to help patient recovery time and get people back on their feet quicker.”
Michael Hewson, chief market analyst at CMC Markets, said: “Today’s European open looks set to be a modestly positive one, with markets in Asia trading modestly higher in a week that is relatively light on data, but where investors will be looking anxiously for further evidence that the rise in virus cases, that is taking place across the globe, is starting to affect the various recoveries from differing stages of lockdown.”
Hewson added that Wall Street’s rally last week — which saw stocks hit record highs — could spark fears of a “sharp snapback”.
Traders will also be looking to this week’s virtual bank symposium, which will take the place of the annual Jackson Hole event.
Analysts said the key focus would be on any clues about potential steps by the Federal Reserve to tackle a second wave of Covid-19 infections.