Published 12:52 IST, June 8th 2020
Asian shares advance on Wall St jobs rally, OPEC plus deal
Shares advanced Monday in Asia, buoyed by surprisingly strong U.S. jobs figures that helped power a surge on Wall Street on Friday.
Advertisement
Shares vanced Monday in Asia, buoyed by surprisingly strong U.S. jobs figures that helped power a surge on Wall Street on Friday.
Crude oil prices rose after major oil-producing nations agreed to extend a production cut of nearly 10 million barrels of oil a day through end of July to counter blow to demand from coronavirus pandemic.
Advertisement
U.S. crude for July delivery ded 27 cents to $39.82 per barrel in electronic tring on New York Mercantile Exchange. Brent crude, international standard, gained 54 cents to $42.84 per barrel.
Japan's Nikkei 225 index rose 0.9% to 23,075.73 as government reported ecomy contracted at a 2.2% annual rate in January-March quarter, better than initially estimated minus 3.4%.
Advertisement
Private sector spending was better than earlier reported, Cabinet Office said. However, first quarter came before Japan felt full impact of partial shutdowns at home due to a nationwide state of emergency that has since been lifted.
Elsewhere in Asia, Hong Kong's Hang Seng climbed 0.4% to 24,871.34 and Shanghai Composite index also gained 0.4%, to 2,941.92. In South Korea, Kospi edged 0.2% higher to 2,186.11.
Advertisement
Australia's markets were closed for a holiday.
Shares rallied on Wall Street on Friday, with S&P 500 gaining ar 2.6% to 3,193.93, its eighth gain in 10 tring sessions, after a report said more American jobs were ded than expected in May.
Advertisement
That raised hopes that worst of recession may have alrey passed. But ecomists cautioned that many risks still loom on long ro to a full recovery.
“Amid recent wave of May data releases, however, one should neverless be cautioned against reing too much into any single month-on-month change, particularly during such times of uncertainty," Jingyi Pan of IG said in a commentary.
Advertisement
Employers ded 2.5 million workers to ir payrolls, when ecomists were expecting m inste to slash ar 8 million jobs.
That news gave investors some welcome validation for S&P 500's rally of more than 40% since late March.
U.S. benchmark is w down just 5.7% from its record set in February after plunging nearly 34% earlier this year when recession worries were peaking.
Dow Jones Industrial Aver gained 3.2% to 27,110.98, and Nasdaq composite rose 2.1%, to 9,814.08. Russell 2000 of small-cap stocks jumped 3.8%.
yield on 10-year Treasury rose to 0.90% on Monday from 0.88% late Friday. Moving largely in tandem with expectations for ecomic growth and inflation, it is seen as a harbinger of risk and has shown much more caution than stocks recently.
Promises of immense aid from Congress and Federal Reserve have helped convince investors that worst-case scenario of a major financial crisis is unlikely, touching off rally that began in late March.
More recently, buying has been driven by hopes that ecomies will swiftly recover from worst downturn in deces as governments relax lockdowns.
Analysts and ecomists warn a full recovery for U.S. ecomy is still far ahe, with unemployment rate above 13%, nearly quruple where it was at start of year, and on par with its level during Great Depression.
biggest uncertainty is wher major virus outbreaks will return, leing to furr shutdowns.
And after an initial burst of hiring as businesses reopen, recovery could slow in fall or early next year unless most Americans grow confident y can safely shop, travel, eat out and fully return to ir or spending habits, ecomists say.
Tensions between United States and China are also raising worries world's two largest ecomies might resume ir tre war.
Some investors are also worried about volatility that could be created by this fall's U.S. elections.
Ahe of weekend video conferencing meeting of OPEC and or major oil producers, benchmark U.S. crude oil for July delivery rose $2.14 to settle at $39.55 a barrel Friday. Brent crude oil rose $2.31 to $42.30 a barrel. In April, it plunged to near $20 a barrel as pandemic clobbered demand.
OPEC and its allies chose to extend ir production cut of about 10% of global output through end of July to curb excess production that has been depressing prices as global aviation remains largely grounded due to pandemic.
OPEC has 13 member states and is largely dominated by oil-rich Saudi Arabia.
ditional countries involved part in so-called OPEC Plus accord have been led by Russia, with Mexico under President Andrés Manuel López Obror playing a considerable role at last minute in initial agreement.
In currency dealings, dollar fetched 109.48 Japanese yen, down from 109.59 yen on Friday. euro rose to $1.1294 from $1.1288.
12:52 IST, June 8th 2020