US equities gained more confidence on Tuesday, as the S&P 500 and tech-oriented Nasdaq updated their record highs. Investor sentiment was buoyed by renewed vaccine optimism. Still, the uncertainty over further stimulus capped the rally.
The S&P 500 rose 0.28%, Dow Jones added 0.25%, and Nasdaq increased by 0.50%.
Pfizer rose over 3% as it made one important step towards obtaining its coronavirus vaccine approval for emergency use. The US Food and Drug Administration said in a new document that there were no new safety or efficacy issues.
Johnson & Johnson added almost 2% to boost both the S&P 500 and the Dow after the behemoth said it might obtain late-stage trial results of its COVID vaccine by January, which is earlier than anticipated.
Meanwhile, the US Congress is expected to vote later this week on a weekly stopgap funding bill to give more time for lawmakers to reach consensus on the next relief package.
Shares of Moderna surged over 6% after Switzerland raised orders for its coronavirus vaccine to 7.5 million from 4.5 million. Yesterday, Canada also increased orders for Moderna’s vaccine.
In Asia, stocks are mostly bullish in early trading on Wednesday, following the advance in US equities.
At the time of writing, China’s Shanghai Composite is down 0.44%, and the Shenzhen Component has declined by 1.16%. Official data released earlier today showed that China’s consumer price index (CPI) contracted 0.6% m/m in November and 0.5% y/y, falling short of expectations. This was the first drop in inflation in over a decade. The producer price index (PPI) contracted 1.5% y/y.
Hong Kong’s Hang Seng is up one percent. A new law allows authorities to shut down regions of the city most affected by the pandemic for up to seven days. General restrictions have also been tightened further.
Japan’s Nikkei 225 closed 1.33% higher.
SoftBank stock surged over 7% after Bloomberg reported that the company was pondering buying back shares to boost CEO Masayoshi Son’s stake to get more control over the group.
Toyota is putting its Mirai hydrogen fuel cell car on sale today. The new technology gives the car 30% greater range.
South Korea’s KOSPI has surged almost 2%.
In Australia, the S&P/ASX 200 closed 0.61% higher. The Westpac Consumer Sentiment for December saw its biggest growth in ten years as it surged to 4.1% after November’s 2.5% increase.
In the commodity market, oil prices have declined during the European morning, after a larger-than-expected increase in US inventories last week. Still, vaccine optimism provides support for crude prices. The American Petroleum Institute reported a 1.141-million-barrel build last week, while investors anticipated a draw. WTI is down 0.46%, and Brent has declined by 0.51%.
Gold is declining on vaccine optimism, after a steep uptrend that helped the metal recover most of previous losses that had forced it to break below $1,800 for the first time since July. Gold futures are down over 0.40% to $1,866.
Meanwhile, US Treasury Secretary Steven Mnuchin proposed a fresh $916 coronavirus relief package to House of Representatives Speaker Nancy Pelosi. The size of the proposed stimulus package is larger than the $908 billion package proposed by a group of lawmakers made up of members of both parties.
In FX, the US dollar is declining amid an increase in appetite for risk assets, supported by vaccine news. The USD Index has declined by 0.25% to 90.743. EUR/USD is up 0.30% to 1.2139.
The pound is stronger than the greenback but has been declining versus the euro, as investors are waiting for new clues about the progress made in the extended trade talks between the UK and the European Union. UK Prime Minister Boris Johnson is visiting Brussels to meet European Commission President Ursula von der Leyen in person. The next 24 hours are crucial.
