MSCI’s broadest index of Asia-Pacific shares outside of japan jumped 0.65%, moving toward a six-month high touched last week. Japan’s Nikkei reversed early losses to be last up 0.4%. Chinese shares rose too with the blue-chip CSI 300 index adding 0.8%. South Korea’s KOSPI, which has been on a slippery slope since hitting a more than two-year peak earlier this month, climbed 0.9%. Sentiment was also supported by a Financial Times report that the trump administration is considering by-passing normal U.S. regulatory standards to fast-track an experimental coronavirus vaccine from the UK for use in America ahead of the presidential election.
“Markets are opening this morning to optimism on the therapeutics front after the FDA authorized the use of blood plasma from COVID-19 survivors to treat sick patients,” said stephen Innes, chief global markets strategist at AxiCorp. “Not the COVID-19 cure all the world is hoping for, but it is another positive step to help patient recovery time and get people back on their feet quicker.” Analysts still urged caution with Wall Street indexes already at record highs even as the world economy struggled to recover from the once-in-a-century pandemic. “With risks rising somewhat and september a full month for policy, the end of summer is a good time to cross-check valuations and to consider both threats and opportunities,” said JPMorgan cross asset analyst john Normand.
Normand pointed to talks of a U.S. fiscal package, Fed’s upcoming policy review next month and the ramping up of the U.S. election campaign as risk events over coming weeks. Looming large over this week was a keenly anticipated address by Federal Reserve Chair Jerome Powell at the Kansas City Fed Jackson Hole symposium, where he will talk on the Fed’s monetary policy framework review. “This takes on even more significance after the market’s evident disappointment last week,” said Ray Attrill, head of forex strategy at Melbourne-based National australia Bank.
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