By Kane Wu
HONG KONG (Reuters) – Asian stocks were firmer on Tuesday following Wall Street’s record highs on its first trading day of 2022, despite worries that the widespread Omicron COVID-19 variant could put the brakes on global economic recovery.
MSCI’s gauge of Asia Pacific stocks outside Japan was up 0.67% in the morning sessions.
Hong Kong’s Hang Seng Index and China’s benchmark CSI300 Index opened up 0.5% and 0.25%, respectively.
“As we start 2022, markets seem to have retained memories of 2021 and put Omicron in the backdrop with focus on Fed rate hikes leading to higher UST yields and underpinning USD strength alongside continued buoyancy in equities,” said Mizuho Bank in a Tuesday note.
Major Wall Street indexes scored record closing highs on Monday, even as the Omicron variant of the coronavirus pushed COVID-19 cases to fresh peaks in the world’s largest economy.
“Markets are focusing more on the likely positive earnings numbers from U.S. in the fourth quarter. We are firmly of the view the U.S. is seeing boom conditions and a very tight labour market which will boost household incomes,” said John Milroy, an Ord Minnett advisor in Sydney.
“…investors are keeping a close watch on inflation and how the Fed may respond if it proves to be other than transitory,” he said.
Apple Inc (NASDAQ:AAPL) on Monday became the first company to reach a $3 trillion stock market value while Tesla (NASDAQ:TSLA) Inc, rose more than 13.5% after reporting stronger-than-expected quarterly deliveries of its electric cars.
The S&P index surged nearly 28% last year, driving MSCI’s 50-country index of world stocks to its third consecutive year of double-digit gains.
The benchmark U.S. 10-year yields hit a six-week high to yield 1.6384%, with investors expecting a series of interest rate raises this year to combat rising inflation.
The commodity markets were also quickly back in the swing of things after their nearly two-year resurgence to close out 2021.
Brent oil rose 0.57% to nearly $79.43 a barrel Tuesday, building on Monday’s gains, which were supported by tight supply and hopes of a further demand recovery in 2022, despite OPEC+ expected to further increase output. U.S. crude was up 0.34% to $76.34 a barrel.
Gold prices rebounded after falling more than 1% on Monday as a risk-on rally in equities pressured bullion. Spot gold gained 0.14% to $1803.3 an ounce Tuesday morning.
Source: Investing.com /Reuters