Stock Markets Mostly Jump on Vaccine, Stimulus Hopes
Fresh hopes for a coronavirus vaccine and another round of U.S. stimulus handed strong gains to most stock markets on Wednesday, although advances were tempered by the reimposition of lockdown measures, while China-U.S. tensions weighed on Hong Kong and Shanghai.
Investors took their lead from Wall Street's pop higher Tuesday, which came after U.S. biotech firm Moderna said the final stage of human trials for a COVID-19 vaccine would start at the end of the month, after a report said first stage tests had been a success.
The news follows an announcement from Pfizer and BioNTech that two of four candidates for treatment had received "Fast Track" designation from U.S. officials.
"It goes without saying that a vaccine will be the gamechanger in the pandemic, the thing that will allow life to return to normal and businesses and households to thrive once again," noted Craig Erlam, analyst at the Oanda trading group.
"So it's hardly surprising that investors get a little excited when the results of these trials emerge, even those in the early stages."
- More U.S. stimulus? -
Providing added support was optimism that the U.S. would add to its stimulus after reports said top Republicans were reconsidering their opposition to it, including on extending supplemental unemployment benefits.
Trillions of dollars pledged by the U.S. and other governments and central banks around the world have been a key driver of the rally in stock markets from their March lows -- but one that is weighing on the U.S. currency.
On the corporate front, Apple shares were set to win a boost at the Wall Street open after a European court on Wednesday annulled an EU order that Apple repay Ireland 13 billion euros ($15 billion) in back taxes.
In futures trading, Apple was up more than two percent.
In Asia on Wednesday, Hong Kong's main stocks index closed flat, with optimism over a vaccine offset by China-U.S. worries and rising infection numbers in the city.
Relations between the superpowers -- already hit by unrest over trade and Chinese mobile giant Huawei -- have been further strained by U.S. President Donald Trump's signing into law of an act authorising sanctions on banks over China's clampdown in Hong Kong.
Meanwhile, infections continue to spike around the world, forcing countries that had been emerging from lockdowns to enforce new measures to contain the pandemic and jolting the economic recovery.
Officials in Hong Kong, which had gone weeks without a new infection, fear the city is about to be hit by a third wave, while Florida, which was one of the first states to lift restrictions, saw a new daily record of deaths Tuesday.
- Key figures around 1115 GMT -
London - FTSE 100: UP 1.8 percent at 6,291.13 points
Frankfurt - DAX 30: UP 1.9 percent at 12,943.05
Paris - CAC 40: UP 2.4 percent at 5,126.20
EURO STOXX 50: UP 1.9 percent at 3,385.76
Tokyo - Nikkei 225: UP 1.6 percent at 22,945.50 (close)
Hong Kong - Hang Seng: FLAT at 24,481.58 (close)
Shanghai - Composite: DOWN 1.6 percent at 3,361.30 (close)
New York - Dow: UP 2.1 percent at 26,642.59 (close)
West Texas Intermediate: UP 1.3 percent at $40.81 per barrel
Brent North Sea crude: UP 1.1 percent at $43.38
Euro/dollar: UP at $1.1438 from $1.1392 at 2040 GMT
Dollar/yen: DOWN at 106.93 yen from 107.28
Pound/dollar: UP at $1.2625 from $1.2551
Euro/pound: DOWN at 90.59 pence from 90.76 pence