By Adam Claringbull
Investing.com – Asian stocks were mostly up in morning trade after U.S. President Donald Trump appeared to alter his stance on COVID-19 stimulus talks, tweeting new proposals overnight. Markets are also factoring in a Democrat win in U.S. presidential elections.
Once again, President Trump has set the tone of opening trade in the APAC region, with most markets up in early trade. Multiple overnight tweets from the president pushed Congress to pass various individual stimulus packages, for industry, consumers, and small business. This reversal encouraged investors looking for positive moves to prop up the COVID-19-ravaged U.S. economy.
The possibility of the U.S Democrats gaining control of all branches of government in the upcoming elections is also being factored into prices, with a larger stimulus package at a later date expected in the invent of a Democrat clean sweep.
The U.S. vice-presidential debate, which took place earlier in the day, is also being looked to for indicators as to the outcome of the U.S. elections due in November.
“Even if there was no slimmed down stimulus package, there is a greater chance of a larger stimulus package later,” National Australia Bank (OTC:NABZY) analyst Tapas Strickland said of a potential Democrat victory when speaking to Reuters.
On the previous day, Federal Reserve Chairman Jerome Powell had been speaking at the National Association for Business Economics (NABE) conference, where he addressed the need for government support:
“Too little support would lead to a weak recovery, creating unnecessary hardship for households and businesses - Over time, household insolvencies and business bankruptcies would rise, harming the productive capacity of the economy and holding back wage growth, by contrast, the risks of overdoing it seem, for now, to be smaller.”
The Australian S&P/ASX 200 jumped 1.36% by 11:24 PM ET (3:24 AM GMT), with major government fiscal support proposed on the previous day giving prices a further boost.
Japan’s Nikkei 225 rose 0.98% and South Korea’s KOSPI was up 0.31%
Hong Kong’s Hang Seng Index was down 0.86%
China’s markets are closed for a holiday. Investors are waiting on China’s Caixin Services Purchasing Managers Index, due out on Friday.