Asian stocks jump after massive gains on Wall Street

Daniel Fowler
March 26, 2020

Southeast Asian stock markets rose sharply on Wednesday as a massive USA fiscal stimulus package to rein in the economic impact of the coronavirus pandemic boosted investor sentiment around the world.

BBC stated that the Dow Jones in the US Industrial Average saw its biggest one-day gain since 1933 on Tuesday, surging 11.4% although the deal had not yet been signed.

Hong Kong rose 3.8 percent, Shanghai was up more than two percent, while Singapore, Sydney and Manila rallied more than five percent and Seoul piled on more than four percent.

The risk-sensitive Australian dollar AUD=D3 jumped over the 60-cent mark for the first time in a week and euro traded up 0.4% up past $1.0835 in a fourth straight day of gains.

Spot gold drifted lower after a squeeze of historic proportions pushed its prices to the biggest one-day gain since November 2008 on Tuesday.

Stocks on Wall Street opened higher Wednesday but more than erased those gains in the first half-hour of trading, dimming hopes for the market's first back-to-back gain since its brutal sell-off began last month on worries about the coronavirus outbreak.

Many nations are now working with stimulus plans to sustain their economic situations, however these strategies have actually obtained combined actions from capitalists. "They do bounce around in these situations".

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Europe's main markets in London, Frankfurt and Paris all opened 4%-5% higher after the Nikkei in Tokyo had risen nearly 7% following some historic moves on Wall Street the previous day. It also stipulates that Americans making up to $75,000 a year will be eligible for a one-time $1,200 cash payment.

House Speaker Nancy Pelosi told CNBC's Jim Cramer, "I think there is real optimism that we could get something done in the next few hours", during an interview on Squawk on the Street on Tuesday.

The stimulus bill's measures to shore up pandemic-battered industries such as airlines and hospitals appeared to help the Dow outperform Wall Street's other benchmarks.

Tokyo ended eight percent higher, with investors there also relieved that the 2020 Olympics had been postponed rather than cancelled. "Europe and Japan should also see double-digit contractions", said Nobuhiko Kuramochi, chief strategist at Mizuho Securities.

European shares continued the rally. Widespread lockdowns leading to business closures and mass layoffs have sparked fears of a deep economic recession, though many experts expect a quick rebound after the virus subsides.

The stimulus package marks progress but the devil's in the details, said Ron Temple, head of United States equity at Lazard Asset Management in NY. "They don't know what their future is going to be like, how are they going to pay the bills", Schumer added.

U.S. President Donald Trump pressed his case for a re-opening of the U.S. economy by mid-April.

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