Global stocks bounce back as Covid fears ease out
Global stock markets advanced on Wednesday after Wall Street rebounded as investors tried to figure out how increasing coronavirus cases will affect the global economy. London and Frankfurt opened higher while Shanghai, Tokyo and Sydney advanced. Hong Kong and Seoul declined. Indian markets were closed for a holiday. The US market has gained ground in choppy trading despite uncertainty about the lingering impact of the virus on business activity and inflation. Investor optimism has been buoyed by higher US corporate profits despite a rise in cases of the virus's more contagious delta variant. Overnight, Wall Street's benchmark S&P 500 index gained 1.5 per cent, recovering much of the previous day's loss.
Anderson Alves of ActivTrades said in a report that "defensive flows eased. However, gains are likely to be capped by lingering concerns over COVID-19's delta variant. A new wave of infections could delay the reopening of global economies."
In early trading, the FTSE 100 in London surged 1.6 per cent to 6,989.90 while the DAX in Frankfurt rose 0.7 per cent to 15,322.69. The CAC in Paris jumped 1.4 per cent to 6,438.83. On Wall Street, futures for the S&P 500 and the Dow Jones Industrial Average were up 0.7 per cent. On Tuesday, the Dow and the Nasdaq composite both gained 1.6 per cent. In Asia, the Nikkei 225 in Tokyo rose 0.6 per cent to 27,548.00 after Japan's June exports jumped 48.5 per cent over a year earlier, beating forecasts. The Kospi in Seoul shed 0.5 per cent to 3,215.91 after South Korea reported a daily high of 1,784 new coronavirus cases. The Shanghai Composite Index rose 0.7 per cent to 3,562.66 while the Hang Seng in Hong sank 0.1 per cent to 27,1224.58. Sydney's S&P-ASX 200 advanced 0.8 per cent to 7,308.70 after Australian retail sales rose 1.3 per cent over a year earlier in the three months ending in June. New Zealand and Southeast Asian markets gained.
The US Centers for Disease Control has said an estimated 83 per cent of US cases are tied to the delta variant. Investors have been encouraged by quarterly results that show many companies are increasing profits. In energy markets, benchmark US oil rose 96 cents to $68.16 per barrel in electronic trading on the New York Mercantile Exchange. Brent crude, the price basis for international oils, added 96 cents to $70.31 per barrel in London. The dollar gained to 110.13 yen from Tuesday's 109.83 yen. The euro fell to $1.1777 from $1.1783.(AP)