Asia report: Markets finish higher on fresh vaccine hopes

Markets in Asia closed green across the board on Thursday, as investors reacted to positive reports from Covid-19 vaccine trials being conducted by Pfizer and BioNTech.

In Japan, the Nikkei 225 was up 0.11% at 22,145.96, as the yen strengthened 0.07% against the dollar to last trade at JPY 107.40.

Technology giant SoftBank Group was up 1.42%, while among the benchmark’s other major components, robotics specialist Fanuc was down 0.31% and Uniqlo owner Fast Retailing was 0.33% weaker.

The broader Topix index managed gains of 0.27% by the end of trading in Tokyo, closing at 1,542.76.

On the mainland, the Shanghai Composite rose 2.13% to 3,090.57, and the smaller, technology-centric Shenzhen Composite added 1.25% to 2,016.05.

South Korea’s Kospi was 1.36% firmer at 2,135.37, while the Hang Seng Index in Hong Kong jumped 2.85% to 25,124.19.

Tensions in Hong Kong were being monitored by market watchers, as the controversial national security law forced on the city by Beijing came into effect.

Police in the special administrative region said they arrested around 370 people on Wednesday, with 10 of those being for breaches of the new security law.

The blue-chip technology stocks were mixed in Seoul, with Samsung Electronics up 0.57%, while chipmaker SK Hynix lost 1.06%.

On the Covid-19 front, fresh data from Pfizer and BioNTech showed their vaccine candidate had been seen to create “neutralising” antibodies, in results that are yet to be peer-reviewed.

The positive development came after a World Health Organization official said overnight that some jurisdictions could need to return to lockdown, as a spike in cases in the US led to more than 12 states pausing or paring back their reopening plans.

According to recent data from Johns Hopkins University, more than 10 million confirmed infections have been recorded globally so far, with at least 511,000 fatalities attributed to the coronavirus.

“US cases of Covid-19 continue to surge, rising more than 50,000 in a single day for the first time,” noted Markets.com chief market analyst Neil Wilson.

“Florida’s new case count rose 4.3%, vs the previous 7-day average of 5.7%, so indications perhaps that the rate of new cases may be coming down there.

“But California, Texas and Arizona recorded their largest one-day rise in cases.”

Tokyo, meanwhile, also reported its highest number of cases in two months, Wilson noted.

“Whilst the rise in cases is slowing the reopening of many states, some may argue that the US is simply heading for herd immunity a lot faster than anywhere else - in the long run this may help, not hinder, the country’s ability to get back to normal social and economic functioning.

“Investors largely are shrugging off higher cases though as Pfizer reported positive results from a vaccine trial.

“But we have been here before - it's too early to get too excited - but a working vaccine is the holy grail as it would allow real normality to return to the economy.”

Oil prices were higher as the region went to bed, with Brent crude last up 0.52% at $42.25 per barrel, and West Texas Intermediate rising 0.5% to $40.02.

In Australia, the S&P/ASX 200 was 1.66% higher at 6,032.70, as the country’s trade surplus missed expectations for May.

The figure for the month came in at AUD 8.025bn, falling short of the AUD 9bn pencilled in by economists polled by Reuters.

All four of the country’s major banks advanced, with Australia and New Zealand Banking Group up 2.01%, Commonwealth Bank of Australia ahead 1.75%, National Australia Bank rising 1.83%, and Westpac Banking Corporation tacking on 1.81%.

Across the Tasman Sea, New Zealand’s S&P/NZX 50 added 1.34% to 11,502.52, led higher by outdoor equipment and apparel brand Kathmandu, which was ahead 11.4%.

The company, which also owns surf brand Rip Curl, described a strong recovery in sales in the last six weeks on Thursday, as the country’s lockdown restrictions loosened significantly after the virus was effectively contained in the Pacific island nation.

Both of the down under dollars were stronger on the greenback, with the Aussie last ahead 0.23% at AUD 1.4427, and the Kiwi advancing 0.63% to NZD 1.5342.