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Stocks rebound as UK approves vaccine

Stocks rebound as UK approves vaccine

The UK approved a Pfizer-BioNTech Covid-19 vaccine for emergency use overnight. The British PM cautioned that the delivery logistics are difficult, but termed it the beginning of the end of the pandemic. US stocks rebounded from losses, and the UK index outperformed with a 1.2% gain.

Other market reactions were muted. Oil rallied, although that may relate more to a weekly draw on crude inventories and recent OPEC+ inspired weakness. Havens came under pressure. The US dollar and Japanese yen fell, and cryptocurrencies backed away from recent gains. Surprisingly, gold extended its rally into a second session, despite the growth positive news.

Futures point to a mixed start for Asia Pacific markets, with small gains in Hong Kong and Australian and a modest fall in Japan. However after overnight trading closed the US Congress passed a bill that imposes conditions on Chinese listing on US exchanges. This may cast a pall over regional trading, especially if there is a strident response from Beijing.

New Zealand stocks may lead the region today after a surprise 8.8% lift in October building permits. Australian PMIs for November released this morning show ongoing expansion across the economy, and could support sentiment and the dollar. Other data released today includes PMIs for Hong Kong and Singapore, Australian trade numbers and the Caixin China PMIs.

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