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Asian shares advance over vaccine news, economic recovery

asian markets

TOKYO: Asian shares improved over positive sentiments due to COVID-19 vaccines and the prospects of more political predictability and economic stimulus under the incoming US President-elect Biden’s administration.

MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.3 percent while Japan’s Nikkei gained 0.6 percent. US S&P 500 future rose 0.2 percent in Thursday’s Asian trade while Nasdaq futures rallied 0.4 percent.

MSCI’s broadest gauge of the world’s shares covering 49 markets added 0.1 percent to bring its gains so far this month to 12.7 percent, on course to make its biggest monthly gain on record.

The rally started after Democrat Joe Biden’s U.S. election victory earlier this month raised hopes for more government spending to support the pandemic-hit economy and for more policy predictability after four years of Donald Trump’s presidency.

Read more: Asian shares plunge after Wall Street’s biggest drop since 1987

“Reduced policy uncertainties are helping markets. It will be easier for companies to make capital expenditures,” said Arihiro Nagata, general manager of global investment at Sumitomo Mitsui Bank.

Earlier on Wednesday on Wall Street, the S&P 500 index shed 0.16 percent and the Dow Jones Industrial Average 0.58 percent, though the tech-heavy Nasdaq Composite increased 0.47 percent.

Traders attributed falls in S&P 500 and the Dow Jones to weak US economic data. Figures from the US Labor Department’s weekly jobless claims suggested that an explosion in new COVID-19 infections and business restrictions were boosting layoffs and undermining the labor market recovery.

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