EQUITIES

Asia-Pacific markets mostly higher in Wednesday trade. In Japan, the Nikkei 225 rose 1.74%, Australia’s S&P/ASX 200 advanced 1.64%, South Korea’s KOSPI added 1.08%, and mainland Chinese stock, the Shanghai composite up 0.09%. Meanwhile, Hong Kong’s Hang Seng index drop marginally to -0.08%, and Singapore’s Straits Times index down-0.54%.

Overnight on Wall Street, the Dow Jones Industrial Average rose 0.9%, to 29,420.92, the S&P 500 dipped slightly 0.14%, to 3,545.53 and the Nasdaq Composite dropped 1.4% to 11,553.86. The fall suffered as investors continued to pull money out of the big tech companies that have benefited most from the pandemic.

European shares also held near 8-month highs on Tuesday, riding a wave of optimism about a COVID-19 vaccine breakthrough.

OIL

Oil prices added on Wednesday as vaccine hopes outweighed the expected negative impact on fuel demand of new lockdowns. Brent crude futures traded to $44.17 a barrel, while U.S. crude at $41.82.

Oil ended nearly 3% higher on Tuesday, Brent closed at $43.61 per barrel, while WTI futures ended at $41.36 per barrel.

CURRENCIES

The dollar remained weak as expectations of better global trade ties and more monetary stimulus under President-elect Biden lifted demand for risky assets. The dollar index against a basket of six major currencies was little changed at 92.63.

The Australian dollar advanced versus the greenback at $0.7317. The New Zealand dollar climbed to a 19-month high after the RBNZ kept rates on hold as expected. The Canadian dollar retreating from the more than 2-year high hit on Monday, was trading 0.2% lower at 1.3032 to dollar. The onshore yuan capitalised on the dollar’s weakness and rose to 6.5926.

GOLD

Gold regained slightly after Monday’s sharp slides as expectations of fiscal and monetary stimulus offered support to the safe haven metal. Spot gold currently trading at $1,882.9 per ounce, while stands around $1,878.40 per ounce for gold futures. Previously closed at $1,877.70 and $1,876.40, respectively.

Silver trading at $24.34, platinum trading at $880.00 and palladium trading at $2,341.00.

ECONOMIC OUTLOOK

Stocks in Asia-Pacific rose in Wednesday morning trade as investor sentiment continued to be buoyed by a positive development on the coronavirus vaccine front and anticipation of a lift in economic activity and a swing back to physical businesses. However, following the vaccine breakthrough, the case for another large U.S. fiscal stimulus bill may weaken.

U.S. crude inventories fell by more than expected. Stockpiles fell by 5.1 million barrels last week to about 482 million barrels, compared with expectations of 913,000 barrels.

To date, number of confirmed worldwide cases for COVID-19 pandemic has surpassed 50.377 million affecting 213 countries and territories around the world and 2 international conveyances, recording more than 1.270 million fatality globally.

TECHNICAL OUTLOOK

[USDJPY]

Important Levels to Watch for Today:

- Resistance line of 105.609 and 105.875.

- Support line of 104.748 and 104.481.

Commentary/ Reason:

- The dollar was last quoted at 105.112 yen, steadying after recorded its biggest gain overnight since March on Monday.

- USD/JPY posted modest losses on early trade as weakness in stocks boosted some safe haven buying of the yen.

- Initial optimism about coronavirus vaccine testing pushed the dollar up against the safe harbour yen, though the momentum is starting to fade because there are still several obstacles to clear before a vaccine can be distributed.