Asia Pacific trading is starting on a positive note after choppy overnight sessions in Europe and the US. A report that US pharmaceutical company Gilead has promising trial results for its anti-viral drug Remdesivir is lifting sentiment. US stock futures are 2%-3% higher this morning after President Trump said that US states could start re-opening “literally tomorrow”.
The lift in stock, industrial commodities and growth-exposed currencies comes despite a number of cautions from medical experts that the body of evidence that supports Remdesivir as a cure for the Covid-19 virus is incomplete and ambiguous. Additionally, President Trump appeared to back away from initial claims, clarifying his remarks that US states could b e ready to begin steps towards re-opening.
The lift in sentiment defies more hard evidence of macro-economic damage overnight as 5.2 million US citizens made initial jobless claims over the last week. German inflation remains limpid, and US housing starts tanked 22.3% in March. Data releases could influence trading today, as markets await China first quarter GDP (forecast -12%) and March industrial production (f/c -6.0%) and retail sales (f/c -10.0%). Singapore non-oil exports are tipped to fall 12.5% in March.
The New Zealand stock index is up 2% in early trading, and the outbreak of optimism could see regional shares outperform tepid overnight leads from futures markets. Healthcare, Consumer and It sectors lead overnight gains. Weakness in Financial and Energy stocks could weigh on the Australia 200 index, but the Straits Times index could add significantly to yesterday’s 0.26% gain.