Asia report: Most markets rise as investors cheer vaccine roll-out

Markets in Asia finished higher on Wednesday, with the exception of bourses in China, as investors cheered the start of Covid-19 vaccinations as the first patient was dosed in the UK.

In Japan, the Nikkei 225 was up 1.33% at 16,817.94, as the yen strengthened 0.06% against the dollar to last trade at JPY 104.10.

Of the major components on the benchmark index, automation specialist Fanuc was up 2.98%, fashion firm Fast Retailing rose 0.71%, and technology conglomerate SoftBank Group surged 5.57%.

The broader Topix index was 1.17% firmer by the end of trading in Tokyo, closing at 1,779.42.

On the mainland, the Shanghai Composite was down 1.12% at 3,371.96, and the smaller, technology-heavy Shenzhen Composite was 1.88% weaker at 2,250.81.

The weakness in China came after fresh data showed the country’s consumer price index as falling in November, fuelled by a drop in food prices.

According to the National Bureau of Statistics, the index was down 0.5% year-on-year in November, making for the first fall in a decade.

The core CPI, which strips out volatile food and energy prices, was higher, rising 0.5% on the year for November.

Deflation in costs of production moderated more than expected for the month, as the producer prices index came in at 1.5%, rising from -2.1% in October and above consensus expectations for a measure of -1.8%.

“Overall, the November moderation in PPI deflation after remaining sticky at around -2.0% for three straight months should reduce the price drag on already punchy industrial profits growth,” said Pantheon Macroeconomics senior Asia economist Miguel Chanco.

“The People’s Bank of China will be more than happy to brush off the likely short-lived bout of CPI deflation, as long as the exit from PPI deflation remains on track.

“We continue to believe that a return to the black will take place in the second quarter, on the back of an extremely favourable lift from commodity base effects.”

South Korea’s Kospi was 2.02% firmer at 2,755.47, while the Hang Seng Index in Hong Kong was ahead 0.75% at 26,502.84.

The blue-chip technology stocks were in the green in Seoul, with Samsung Electronics up 3.07% and SK Hynix ahead 4.78%.

Sentiment was relatively rosy at the start of the Asian day, as investors in the region got their first chance to react to the start of the UK’s coronavirus vaccination programme - the first OECD nation to begin administering an approved vaccine.

The Pfizer-BioNTech jabs, which gained emergency approval from the Medicines and Healthcare Products Regulatory Agency last week, were being rolled out to elderly and vulnerable patients initially through a number of hospitals nationally.

Hopes were high that US regulators would soon follow suit, with the Food and Drug Administration releasing a briefing that the vaccine had a “favourable safety profile” ahead of a meeting of its vaccine committee on Thursday.

Oil prices were higher at the end of the Asian day, with Brent crude last up 0.51% at $49.09 per barrel, and West Texas Intermediate advancing 0.57% to $45.86.

In Australia, the S&P/ASX 200 gained 0.61% to 6,728.50, with major miners in the green by end-of-play in Sydney.

BHP was up 1.14%, Fortescue Metals added 1.58% and Rio Tinto managed gains of 0.37%.

Across the Tasman Sea, New Zealand’s S&P/NZX 50 rose 1.34% to 12,889.40, as infrastructure conglomerate Infratil rocketed 19.24%.

The gains came after its board rejected a NZD 7.43 per share takeover offer from the AustralianSuper investment fund as “materially undervaluing” its portfolio.

Both of the down under dollars were stronger on the greenback, with the Aussie last ahead 0.92% at AUD 1.3371, and the Kiwi advancing 0.61% to NZD 1.4110.