Asian markets rise after rout, pound extends losses - GulfToday

Asian markets rise after rout, pound extends losses


Picture used for illustrative purpose. File

Asian markets ticked higher Tuesday after last week's steep drops as investors brushed off Donald Trump's latest anti-China salvo, while sterling suffered more selling pressure on fears over Brexit talks.

Tokyo piled on 0.8 percent and Sydney climbed more than one percent while Shanghai and Seoul enjoyed healthy rallies. There were also gains in Hong Kong, Taipei, Singapore, Jakarta and Wellington. London rose in the morning, building on Monday's rally, though Paris and Frankfurt dipped.

Despite continued uncertainty about the timetable for economic recovery -- and with no coronavirus vaccine yet available -- investors remain convinced central banks around the world are willing to play backstop and keep monetary policy supportive for years to come.

The wall of cash put up by authorities has been credited with fuelling an incredible surge in world markets from March troughs -- led by tech firms which have benefited from people staying at home during the pandemic.

Last week's harsh sell-off brought that rally to a juddering halt, but analysts do not expect a retreat anything like that seen earlier in the year. 


Global economy seeing sharper V recovery, raising case for inflation: Morgan Stanley

Gold eases on firmer dollar; focus shifts to central banks

Oil prices fall on demand fears as US summer driving season ends

"The sell-off provides a stark reminder that with everybody holding on to the same side of the vaccine life-raft, it should not be too unexpected that when the seas turn rough, many will fall into the drink on the first significant starboard list," said Stephen Innes at AxiCorp.

"Still, investors have ample flotation thanks to the Federal Reserve, and the fiscal harness would allow them to hurry back aboard with relative ease if they so choose."

There was little initial reaction to Trump saying he wanted to wind back Washington's economic relationship with China, warning he would stop US firms doing business with the country from winning federal contracts.

"We'll manufacture our critical manufacturing supplies in the United States, we'll create 'made in America' tax credits and bring our jobs back to the United States and we'll impose tariffs on companies that desert America to create jobs in China and other countries," the president said in a White House news conference.

He also said he would "hold China accountable for allowing the virus to spread around the world".

Agence France-P resse

Related articles