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Asian Stocks Mixed Over Vaccines, U.S. Stimulus Measures Uncertainty

Published 12/03/2020, 09:38 PM
Updated 12/03/2020, 09:53 PM
© Reuters.

By Gina Lee       

Investing.com – Asia Pacific stocks were mixed on Friday morning, with investors continuing to take stock of global shares’ record rally in November and awaiting U.S. labor market data. News of potential supply-chain problems for a COVID-19 vaccine also capped gains. 

The data, including manufacturing payrolls  and non-farm payrolls, are due out later in the day. The data is expected to show modest gains in U.S. employment despite the country grappling with a second wave of COVID-19. 

Japan’s Nikkei 225 fell 0.43% by 10:31 PM ET (2:31 AM GMT), while South Korea’s KOSPI rose 1.64%.      

In Australia, the S&P/ASX 200 was up 0.32%. Australian retail sales grew 1.4% month-on-month in October, under the 1.6% growth in forecasts prepared by Investing.com but above the 1.1% contraction seen in September.  

Hong Kong’s Hang Seng Index edged up 0.11%.     

China’s Shanghai Composite fell 0.39% and the Shenzhen Component was down 0.26%. 

Global shares remained just within reach of record highs over investor optimism that positive vaccine developments could sustain a global recovery in 2021. 

However, Pfizer Inc (NYSE:PFE) saw its shares decline as much as 3.1% during the previous session after a report claimed that it would ship only half of the expected doses of BNT162b2, its COVID-19 vaccine co-developed with BioNTech SE (NASDAQ:BNTX). Supply chain issues means that 50 million, not the originally anticipated 100 million, doses will be shipped.  

National Institute of Allergy and Infectious Diseases Anthony Fauci also slammed the U.K.’s Medicines and Healthcare products Regulatory Agency’s approval for BNT162b2, claiming that it was rushed. Fauci later apologized for his comments. 

Moderna Inc (NASDAQ:MRNA) also awaits U.S. and European approval for its candidate mRNA-1273, and released a study showing that its vaccine has the potential for durable immunity. 

Meanwhile, the number of global COVID-19 cases continues to rise. The number rose above 65 million as of Dec. 4, according to data from the Johns Hopkins University.  In the U.S., California warned that it will lock down its economy if its critical-care capacity reaches its limit. President-elect Joe Biden also said he would ask all Americans to wear a mask to prevent the spread of COVID-19 for the first 100 days of his administration. 

"The U.S. fiscal situation is pretty fluid, but it's more encouraging than in the beginning of the week … but there's too much uncertainty to do anything with a great degree of confidence." National Australia Bank (OTC:NABZY) head of FX strategy Ray Attrill told Reuters. 

The uncertainty extends to the latest U.S. stimulus packages, with a Dec. 11 deadline to avert a government shutdown looming. However, a proposed $908 billion bipartisan package was slowly gaining traction in Congress on Thursday.  

However, some investors remained optimistic. 

“If we do see earnings growth start to pick up, perhaps 25% to 30% on the S&P 500 next year, and if we see rates remain low and stimulus in place, that remains a good backdrop for risk assets,” Allianz (DE:ALVG) Global Investors investment strategist Mona Mahajan told Bloomberg. 

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Latest comments

The following is the extract on the website, https://www.nytimes.com/live/2020/12/01/business/us-economy-coronavirus  : 'The Treasury secretary pointed to the fact that many jobs have come back and said the unemployment rate had dropped far faster than many had expected.  While he agreed that some industries, like restaurants, need support, he reiterated that any additional fiscal spending should be 'target.' ' From the above statement, the Treasury secretary mentions the optimistic impact in the increase in the number of jobs in the market and the drop of unemployment rate.  This obviously is the result of the government to introduce more fund in financing small and medium companies especially the interest is set at nil and this eases the survival of small and medium companies since they can borrow fund from banks at no additional burden, i.e. the exemption of loan interest.
The following is the extract on the website, https://www.nytimes.com/live/2020/12/01/business/us-economy-coronavirus  : 'Mr Mnuchin announced in November that he would end several Fed emergency loan programs, which are meant to keep credit flowing to state and local governments and medium-sized businesses alike.' Mr Mnunchin announced to end several Fed emergency loan program and to divert the fund to keep credit flowing for local governments and medium-sized business alike.  This is indeed a good news to medium sized businesses since many medium-sized businesses that are badly affected by COVID-19 situation can have the chance to get loan easily to ease the finance of the growth of their businesses.  This will indeed assist to lower the unemployment as their businesses grow due to their ease in getting loan to finance their businesses.
The following is the extract on the website, https://www.reuters.com/article/us-usa-economy-hearing/mnuchin-powell-press-again-for-deal-to-get-economy-through-the-covid-winter-idUSKBN28C2W1   :  'The heads of the US Treasury Department and Federal Reserve on Wednesday renewed calls for legistators to reach agreement on additional funds to help small businesses get through the next few months before a coronavirus vaccine is in wide enough use to allow a broad based economy recovery to take hold.'   From the above statement, it is certain that US has reached the agreement for additional funds to help small businesses despite US stimulus measure is uncertain.  With the introduction of additional funds to assist small businesses, it enables the small business to survive and to grow and this would lower the increase in unemployment rate and small businesses can survive with the help.
who is holding china accountable for all of this. it won't be biden
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