SYDNEY (REUTERS) – Asian shares jumped on Tuesday (May 19) and oil extended gains on optimism the global economy would recover quickly following a successful early-stage trial of a coronavirus vaccine, while the euro hovered near a two-week top.
MSCI's broadest index of Asia Pacific shares outside of Japan rose 1.5 per cent to two-week highs.
Australia's benchmark index and Hong Kong's Hang Sang were the lead gainers, up 2 per cent each, South Korea added 1.8 per cent while China's blue-chip index climbed 0.8 per cent.
Japan's Nikkei added 2 per cent to the highest since early March.
Singapore's Straits Times Index was up 2.1 per cent at 10:59am local time.
The gains followed a rally on Wall Street overnight after data from Moderna Inc's Covid-19 vaccine, the first to be tested in the United States, showed it produced protective antibodies in a small group of healthy volunteers.
The positive early test results boosted sentiment as investors wagered on a faster-than-expected economic recovery.
Analysts, for now, expect a steep contraction in world growth with the outlook for 2021 still uncertain with no approved treatments or vaccines for COVID-19 currently.
Experts predict a safe and effective vaccine could take 12 to 18 months to develop.
On Wall Street overnight, the benchmark S&P 500 posted its biggest one-day percentage gain in almost six weeks, gaining 3.15 per cent. The Dow Jones Industrial Average rose 3.85 per cent and the Nasdaq Composite added 2.44 per cent.
"It may be the case that central bank liquidity is chloroforming markets to overlook risks such as overleveraged corporate and government balance sheets, growing COVID-19 case numbers, growth holes and a slow recovery path," analysts at Perpetual wrote in a note.
E-minis for the S&P 500 were off 0.2 per cent in Asian trading.
The vaccine optimism sent treasury yields surging overnight as investors dumped bonds, while gold came off its peak. Spot prices were last up 0.4 per cent $1,739.2 an ounce.
There was good news in Europe too, after France and Germany called for the creation of a 500 billion euro ($543 billion) Recovery Fund able to offer grants to the countries and regions hardest hit by the coronavirus crisis.
The euro hovered neaRead More – Source