Currency Hedger Trading Desk May 5, 2020
Asian stocks rose in thin holiday trade on Tuesday after several countries across the world eased Covid-19 lockdown restrictions. A rally in shares of major U.S. technology companies overnight also helped soothe worries over a recent spike in Sino-U.S. tensions over the coronavirus' origin.
Markets in China, South Korea and Japan were closed for Labor Day, Children's Day and Accession Day, respectively. Hong Kong's Hang Seng index ended up 1.08 percent at 23,868.66 after falling more than 4 percent in the previous session.
Hong Kong's economy shrank 8.9 percent in the first quarter as compared to the year-ago period, according to an advance government reading. This marked the worst contraction in Hong Kong's GDP so far as the coronavirus pandemic dealt a blow to the Asian financial hub following months of social unrest.
Australian markets rallied, led by energy stocks. The benchmark S&P/ASX 200 climbed 87.30 points, or 1.64 percent, to 5,407.10, while the broader All Ordinaries index ended up 88.60 points, or 1.64 percent, at 5,478.10.
Woodside Petroleum, Origin Energy, Beach Energy and Santos jumped 4-5 percent as oil prices extended gains from last week on hopes that the worst of the demand destruction caused by the coronavirus pandemic is over. Fiber cement maker James Hardie Industries rallied 4.9 percent after providing a strategic business update. Airline Qantas advanced 1.7 percent after it secured $550 million in debt funding.
Miners BHP, Rio Tinto and Fortescue Metal Group rose 2-3 percent, while BlueScope Steel shares surged as much as 7.4 percent.
Gold miners Evolution and Newcrest Mining rose about 3.6 percent each after gold prices extended gains overnight.
The big four banks added 2-3 percent as a survey showed signs of an improvement in local consumer confidence and the Reserve Bank of Australia left its targets for the cash rate and three-year government bond yields unchanged.
Meanwhile, the latest survey from the Australian Industry Group revealed that the construction sector in Australia continued to contract in April, and at a much steeper pace due to the Covid-19 pandemic, with a Performance of Construction Index score of 21.6, down from 37.9 in March. Australia's service sector contracted at a record pace in April as
strict measures to contain the coronavirus disease outbreak impacted the activity, survey data from IHS Markit showed. The Commonwealth Bank of Australia Services Business Activity Index fell steeply to 19.5 in April from 38.5 in March.
New Zealand shares pared early gains to end modestly higher. The benchmark NZX-50 index ended up 14.75 points, or 0.14 percent, at 10,490.73 after hitting as high as 10,553.57 earlier in the day. Kathmandu Holdings shares soared 10.7 percent after the outdoor clothing retailer said it has seen a surge in online sales and digital engagement during the month of April.
The total number of building permits issued in New Zealand tumbled a seasonally adjusted 21.3 percent month-on-month in March, Statistics New Zealand said in a report. That follows the upwardly revised 5.7 percent increase in February (originally 4.7 percent).
U.S. stocks reversed from an early slide to end higher overnight despite indications that Sino-American relations are about to get worse.
The Dow Jones Industrial Average edged up 0.1 percent and the S&P 500 gained 0.4 percent, while the tech-heavy Nasdaq Composite climbed 1.2 percent.