BANGKOK: Shares were mostly higher in Asia on Thursday, though Japan’s benchmark index fell as local leaders sparred with Prime Minister Shinzo Abe’s government over measures to contain the coronavirus outbreak there.
After a 3.4-percent overnight rally on Wall Street, markets advanced in Hong Kong, Sydney and Shanghai. Investors seem reassured by signs that deaths and infections may be nearing a peak or plateau in some of the world’s hardest-hit areas.
And a meeting of oil producers planned for Thursday raised hopes that energy companies might get some relief in the form of production cuts to help support crude prices amid collapsing demand.
Japan’s Nikkei 225 index lost 0.3 percent, to 19,298.64, after the central bank governor said the economy faces “extremely high” uncertainty over the likely impact of the pandemic.
That uncertainty was heightened by disagreement between leaders over just how quickly and far to extend precautions meant to contain a surge in coronavirus infections.
Abe’s spokesman said that after declaring a state of emergency for Tokyo and six other hard-hit areas on Tuesday, the government planned to see whether residents were complying with the entirely voluntary request to stay at home before deciding on whether or not to ask more businesses to close.
That ran counter to Tokyo Gov. Yuriko Koike’s efforts to get stronger compliance, since so far the requests appeared to have achieved only about half of the 70- to 80-percent social distancing Abe said he was aiming for.
The governor of Aichi, a prefecture not included in Abe’s state of emergency declaration and home to the Toyota Motor Corp.’s headquarters, asked that it also be included. The region has reported dozens of police officers falling sick from the coronavirus.
Shares also fell in Taiwan, Malaysia and Indonesia.
But elsewhere in Asia, markets were mostly higher. Hong Kong’s Hang Seng added 0.5 percent to 24,100.09 and the Shanghai Composite index gained 0.5 percent to 2,829.30. South Korea’s Kospi climbed by 1 percent to 1,825.22, while India’s Sensex surged by 2.1 percent to 30,526.79.
Futures for the S&P 500 and the Dow industrials edged higher.
Recent upward swings in markets have dwarfed declines amid signs that deaths and infections may be nearing a peak or plateau in some of the world’s hardest-hit areas.
That’s led some investors to begin looking to the other side of the economic shutdown that is gripping the world as authorities try to slow the spread of the coronavirus. The S&P 500 has jumped by nearly 23 percent in the last two and a half weeks, building on earlier gains driven by massive amounts of aid promised by governments and central banks for the economy and markets.
“Risk assets continued to rally on the perception that the global economy will open up again quicker than expected,” Stephen Innes of AxiCorp said in a commentary.
The prospect for progress in talks among oil producers was a big driver of Wednesday’s rally, analysts said.
Oil prices have been even more volatile than stocks recently as Russia and Saudi Arabia bicker over production levels as demand withers. Oil producers were set to meet on Thursday, and an announcement for production cuts to prop up the price of crude is possible.
“The icing on the cake… a ‘good’ outcome for oil prices from the OPEC+ meeting, would be a global agreement to cut output… beyond OPEC and Russia, although demand concerns will persist,” Innes said.
Many analysts say they’re skeptical of the recent stock rally given how much uncertainty still remains. The death toll continues to rise, millions of people are still losing their jobs by the week and the economic pain is worldwide.
But Dr. Anthony Fauci, the top US infectious diseases expert, raised hopes when he said the White House is working on plans to eventually reopen the country. President Donald Trump later said it “will be sooner rather than later.”
The S&P 500 climbed by 3.4 percent to 2,749.98. The Dow Jones Industrial Average also rose by 3.4 percent to 23,433.57. The Nasdaq added 2.6% to 8,090.90.
Stocks that have been beaten down the most since the sell-off began in February helped lead the way, including energy companies, retailers and travel-related companies.