Asian stocks and the British pound rose on the Thursday before the Christmas break as the UK and European Union signed a free trade agreement and investors placed bets on the prospect of a global economic recovery.
MSCI’s broadest index for stocks in the Asia-Pacific region outside of Japan rose 0.45 percent. Australian stocks rose 0.33 percent while Tokyo stocks rose 0.45 percent.
Chinese stocks fell 0.28 percent.
Alibaba Group Holding Ltd shares fell 8.13 percent. This was the biggest daily drop in six weeks after China’s market regulator announced it was investigating the tech giant for suspected monopoly behavior.
The US stock futures gained 0.16 percent.
The FTSE futures were up 0.56 percent. The Euro Stoxx 50 futures rose 1.15 percent, while the German DAX futures rose 1.28 percent, indicating a good start to the European session.
Investors welcomed the news that on Thursday the UK and the EU are on the verge of signing a tightly focused trade deal that would help them avoid a tumultuous economic rupture on New Years Day.
Hopes for more household spending and expectations for coronavirus vaccines to become more available in the next year also supported global stocks.
“A risky and weak dollar theme dominated the markets in terms of optimism about vaccines, fiscal stimulus in the US and UK and Brexit, with the hope that an agreement can be reached before Christmas,” wrote analysts at ANZ Bank in a research memo.
The potential for a Brexit deal added to the pound sterling, which rose 0.47 percent to $ 1.3558. The pound rose to 90.05 pence per euro.
The pound also found support after France lifted its UK freight ban, which it put in place in response to a more contagious variant of coronavirus in the UK.
[Bloomberg]MSCI’s assessment of global stocks rose 0.12 percent, but moves in thin holiday trading were subdued.
Alibaba, co-founded by Chinese billionaire Jack Ma, was the stock that was seen in Asia on Thursday as Chinese authorities stepped up their campaign against large tech companies.
Separately, Ant Group, the mobile payments and consumer credit division of Ma’s tech empire, said it will meet all regulatory requirements after China’s financial watchdogs announced they would have regulatory talks with it in the coming days.
Last month, China halted the $ 37 billion double listing of the Ant Group, suppressing the world’s largest public offering.
Wall Street ended up largely higher on Wednesday, with the Dow Jones Industrial Average up 0.38 percent and the S&P 500 up 0.07 percent. The Nasdaq Composite was down 0.29 percent.
A series of mixed US economic data showed lower jobless claims and a surge in durable goods orders, but also a decline in consumer spending, falling personal incomes, and fading sentiment as the holiday shopping season draws to a close amid a resurgent pandemic.
Investors largely shook off US President Donald Trump’s comments that a nearly $ 900 billion stimulus package agreed after months of controversy in Congress was “a shame” he may not sign.
“Risk sentiment still guides the markets to this day, and seems more geared towards possible optimism about a Brexit deal and the cherry-picked pieces of US releases than Trump’s reckless antics in signing the stimulus and funding bill.” he told Derek Holt, head of Capital Markets Economics at Scotiabank.
Brent crude oil futures rose 38 cents to $ 51.58 a barrel through 5:30 GMT while US West Texas Intermediate crude rose 31 cents to $ 48.43, reflecting a decline in US inventories and a potential Brexit trade agreement was favored.