Most Asian, European markets lifted by recovery optimism

accreditation
0:00
play article
Subscribers can listen to this article
Financial stock exchange market display screen board on the street
Financial stock exchange market display screen board on the street
  • Most markets in Asia and Europe rose Thursday as investors welcomed a strong jobs report from the United States.
  • US private firms added 742 000 jobs in April, marking a fourth straight monthly gain.
  • The reading confirmed that the battle against unemployment is being won, and analysts said the improvement was expected to continue as the reopening continues.


Most markets in Asia and Europe rose Thursday as investors welcomed a strong jobs report from the United States that reinforced optimism that the world's top economy is well on the recovery track, though inflation concerns continue to dog trading floors.

The White House's support for a global waiver on patent protections for Covid-19 vaccines also provided some cheer as it lifted hope for a speedier recovery in poorer nations that have struggled to access the jabs.

US private firms added 742 000 jobs in April, payrolls firm ADP said Wednesday, marking a fourth straight monthly gain, with much of them in the crucial services sector, which was hardest hit by virus lockdowns and other restrictions last year.

The reading, while slightly short of forecasts, confirmed that the battle against unemployment is being won, and analysts said the improvement was expected to continue as the reopening continues.

It also bodes well for Friday's closely watched government data, which provides a snapshot of the state of the economy.

But there is a growing fear that the expected burst of economic activity this year caused by pent-up consumers returning to stores and restaurants -- with government cash in their pockets - will send inflation rocketing and force the Federal Reserve to tighten its ultra-loose monetary policy.

And traders are struggling to take heart from reassurances from top Fed officials, who have repeatedly said the bank will stick to its guns until it has unemployment tamed and inflation is running consistently hot.

'Monumental moment'

Tokyo rose 1.8% as traders returned to work for the first time since Friday, while there were also gains in Hong Kong, Singapore, Seoul, Mumbai and Bangkok.

Shanghai dropped as dealers there also came back after a three-day holiday, while Sydney, Wellington, Manila and Jakarta also fell.

London, Frankfurt and Paris were all well up in early business.

The gains followed a strong lead from Europe, where London hit a more than 14-month high and strong eurozone growth figures also sent Paris and Frankfurt surging.

The Dow and S&P 500 edged up but the Nasdaq fell again owing to further weakness in the tech sector.

Investors welcomed comments from US Trade Representative Katherine Tai, who said the Biden administration "supports the waiver of those protections for Covid-19 vaccines" in order to end the pandemic, which has killed more than three million and battered the global economy.

World Health Organization boss Tedros Adhanom Ghebreyesus called the decision "historic", saying it marked "a monumental moment in the fight against Covid-19".

European Commission President Ursula von der Leyen said Thursday that Brussels was ready to discuss the proposal.

Better access for more countries to the shots would help them to reopen their economies sooner and help the global recovery effort.

However, Asian vaccine makers sank, with Shanghai Fosun Pharmaceutical collapsing 14% in Hong Kong and 10% in Shanghai, while CanSino Biologics, which makes one of China's domestic vaccines, dropped 15% in Hong Kong and 14.4% on the mainland.

Oil prices inched up, supported by demand optimism as vaccines are rolled out and economies reopen, though fears about the record spike in infections and deaths in major consumer India has kept a lid on further gains.

Brent is sitting close to levels not seen since January last year before the pandemic took a grip on the planet.

We live in a world where facts and fiction get blurred
In times of uncertainty you need journalism you can trust. For only R75 per month, you have access to a world of in-depth analyses, investigative journalism, top opinions and a range of features. Journalism strengthens democracy. Invest in the future today.
Subscribe to News24
Rand - Dollar
14.27
-0.0%
Rand - Pound
19.88
+0.1%
Rand - Euro
17.02
+0.1%
Rand - Aus dollar
10.77
+0.1%
Rand - Yen
0.13
+0.1%
Gold
1,779.88
+0.1%
Silver
25.94
+0.7%
Palladium
2,587.50
+1.1%
Platinum
1,093.99
+1.0%
Brent Crude
74.81
-0.1%
Top 40
59,494
0.0%
All Share
65,552
0.0%
Resource 10
61,934
0.0%
Industrial 25
87,234
0.0%
Financial 15
12,834
0.0%
All JSE data delayed by at least 15 minutes Iress logo
Company Snapshot
Voting Booth
Should government have assigned a majority shareholding in SAA to the private sector?
Please select an option Oops! Something went wrong, please try again later.
Results
Yes, It's a good decision
68% - 418 votes
Not a good move
9% - 53 votes
Too early to tell
23% - 144 votes
Vote