Asian Stocks Up, Regain Momentum Thanks to Positive U.S. Company Earnings

Asian Stocks Up, Regain Momentum Thanks to Positive U.S. Company Earnings

Stock Markets54 minutes ago (Jul 21, 2021 10:37PM ET)

(C) Reuters.

By Gina Lee – Asia Pacific stocks were up on Thursday morning, continuing to regain momentum on the back of positive U.S. company earnings that eased concerns about the global economic recovery from COVID-19.

South Korea’s KOSPI rose 0.97% by 10:23 PM ET (2:23 AM GMT). In Australia, the ASX 200 rose 0.93% with the state of Queensland closing its border with New South Wales to curb the spread of Sydney’s COVID-19 outbreak. The National Australia Bank (NAB) Quarterly Business Confidence index, released earlier in the day, was also a lower-than-expected 17.

Hong Kong’s Hang Seng Index jumped 1.74%.

China’s Shanghai Composite edged up 0.17% and the Shenzhen Component edged up 0.18%.

Japanese markets were shut for a holiday, ahead of the Tokyo Olympic Games’ opening ceremony on Friday.

Benchmark 10-year U.S. Treasury yields climbed towards the 1.3% mark, with a recent bond rally coming to an end and a poor auction of 20-year debt. However, 10-year yields in Australia and New Zealand jumped.

Verizon Communications Inc. (NYSE:VZ) and Coca-Cola Co . (NYSE:KO) reported better-than-estimated results, while United Airlines Holdings Inc (NASDAQ:UAL) forecast profits despite the ever-present threat of COVID-19. The positive results gave U.S. shares a boost, with the S&P 500 recording its biggest back-to-back advance in two months.

Positive earnings, combined with a continuously dovish monetary policy from the U.S. Federal Reserve, calmed some of the concerns earlier in the week over surging numbers of COVID-19 cases involving the Delta variant and its impact on economic recovery.

Some investors remained optimistic about global shares’ prospects, with their turnaround from their selloff early in the week showing “corporations have been very resilient through all this,” Direxion head of product David Mazza told Bloomberg.

“Earnings estimates are quite remarkable, probably some of the best on record. Even through all this, we have central bank liquidity remaining very abundant, economic growth being robust. Certainly there are some question marks around how long that can continue, but for the time being momentum is at investors’ back,” he added.

Other investors sounded a more pessimistic note, however. September and October could be rough for stocks and U.S. equities could pull back 15%, Guggenheim Investments Chairman Scott Minerd told Bloomberg.

On the central bank front, investors now await policy decisions from Bank Indonesia and the European Central Bank (ECB).

In the U.S., Fed Chairman Jerome Powell will likely be renominated for a second term, even as the decision is due later in 2021 and has reportedly not yet been put in front of President Joe Biden. U.S. existing home sales data is also due later in the day.

In cryptocurrencies, Bitcoin held above the $32,000 mark after luminaries including Tesla Inc. (NASDAQ:TSLA) CEO Elon Musk and Ark Investment Management CEO Cathie Wood discussed its prospects at the B Word conference.

Asian Stocks Up, Regain Momentum Thanks to Positive U.S. Company Earnings

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