Asian markets edge back up after strong Wall St rebound

HONG KONG (AFP): Asian markets edged up Thursday (Sept 10) following a rebound on Wall Street, while a report that a promising vaccine trial could soon resume after being put on hold added further cheer.

The Nasdaq led a surge in New York as technology firms, who had suffered painful losses since the end of last week, staged a strong recovery led by giants including Apple, Microsoft and Tesla.

Analysts said the three-day retreat came after months of mind-boggling gains that had pushed company valuations to unsustainable levels and provided a much-needed release of pressure.

The Nasdaq piled on 2.7 per cent, while the S&P 500 chalked up a two-per cent jump, providing a healthy lead for investors in Asia with the tech sector a big winner, though gains were shallower.

Tokyo, Shanghai, Singapore, Sydney and Taipei rose around 0.5 per cent while Hong Kong was up slightly less. Seoul and Wellington added 0.8 per cent. But Jakarta plunged four per cent after authorities reimposed containment measures in the capital to battle a resurgence of the coronavirus.

"The rebound rally might suggest that investors remain confident about the economic prospects where a virus vaccine still provides a pillar of support, albeit with some dents in the armour," said Stephen Innes at AxiCorp.

"But ultimately, they remain codified around the Federal Reserve boards' redoubtable policy support," he added, referring to the US central bank's multi-trillion-dollar financial backstop.

However, he did warn that virus concerns continue to play in the background as governments try to balance rebooting their economies against fuelling fresh waves of the disease, particularly with the northern hemisphere winter approaching.

Hopes for a vaccine were given a boost by a report in the Financial Times, which said the trial being conducted by AstraZeneca and the University of Oxford could resume early next week, after they "voluntarily paused" it when a volunteer developed an unexplained illness.

The drug is a frontrunner in the global race for a vaccine.

The FT said people close to the study had raised the prospect of a resumption once its data monitoring board had investigated the issue.

Still, OANDA's Edward Moya said the delay was being spun by some "as good news that developers are upholding their pledge to uphold the integrity of the scientific process of finding a vaccine".

Focus is now on the European Central Bank's next policy meeting later in the day, with speculation it could unveil fresh economic support measures as several countries struggle with fresh infection spikes.

Investors are also keeping track of trade talks between Britain and the European Union after Boris Johnson's government introduced legislation that intentionally breaches its obligations regarding Northern Ireland in the withdrawal treaty.

The move has fanned fears Britain will exit without an agreement, dealing a double-whammy to the country's stuttering economy that has been ravaged by virus lockdowns.

Such concerns have sent the pound tumbling and it is sitting around six-week lows against the dollar.

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