Tech stocks lead Wall Street charge
Wall Street’s army of dip buyers emerged tentatively from hiding overnight, after sheltering for the past three sessions. Led, of course, by big tech, Wall Street finished on a positive note. The S&P 500 rose 2.0%, the NASDAQ jumped by 2.70%, and the Dow Jones rallied by 1.60%.
As is Asia’s want in recent times, regional markets have moved my more circumspectly, even the ever-exuberant Australians. That is a two-way street, with Asia refusing to mirror the Wall Street sell-off in its scale either. It suggests Asia, while happy to buy into the get long everything global recovery rally, are viewing daily price action in New York with some caution. That view has merit, especially when one strips out the big-tech effect from the major indices. All stocks are created equal, but some are more equal than others, to paraphrase George Orwell.
Asia-Pacific’s stock markets are showing a moderately higher to neutral performance today. The Nikkei 225 has risen 0.88% and the KOSPI by 0.87%. In China, the Shanghai Composite and CSI 300 are both 0.61% and 0.06% lower respectively, with Hang Seng 0.64% lower. Singapore is down 0.20%, and Kuala Lumpur is down 0.70% ahead of today’s rate decision by the Malaysian central bank. Australia’s All Ordinaries and ASX 200 meanwhile, have risen a modest 0.50%.
In Jakarta, the author’s own private universe is about to get smaller again. Overnight the Jakarta Governor announced the return of fell scale movement restrictions from this Monday, after two months of semi-freedom. Covid-19 cases have been rampant in the big durian, and the Governor himself said that hospitals are dangerously near full capacity. Local companies recalling their staff to the office, instead of working from home, is allegedly the culprit behind the latest virus surge and stands as a stark warning to other countries around the world considering the same. The re-imposition of lockdowns has weighed on the Jakarta Composite Index, which has gapped lower and fallen by 5.00% on the lockdown announcement. That fall may also be weighing on its neighbours in Malaysia and Singapore. The JCI is testing its 100-day moving average (DMA) as we speak, with an extended new lockdown in Jakarta negative for Indonesian assets on many levels.
Northern Asian markets are likely to continue in a positive mood for the rest of the session. However, South-East Asian markets are likely to underperform, weighed down by the Jakarta Covid-19 effect.