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Asian Shares Soar, US Markets Rebound as White House, Senate Strike Deal on Coronavirus Stimulus Bill

James Hyerczyk

The major Asia-Pacific stock indexes are trading higher on Wednesday, chasing yesterday’s spectacular gains on Wall Street, as investors awaited the announcement of a gigantic stimulus deal by U.S. lawmakers. Japan’s Nikkei 225 led the charge for a third consecutive session. The Topix Index was also a big winner.

South Korea and Hong Kong also showed impressive gains despite reports that the number of new cases of coronavirus in South Korea jumped by 100 as of Wednesday morning, according to the Korea Centers for Disease Control and Prevention. It also reported six new deaths.

At 05:32 GMT, Japan’s Nikkei 225 Index is trading 19213.05, up 1120.70 or +6.19%. Hong Kong Hang Seng Index is at 23113.80, up 450.31 or +1.99% and South Korea’s KOSPI Index is trading 1673.11, up 63.14 or +3.92%.

In China, the Shanghai Index is at 2763.66, up 41.22 or +1.51% and Australia’s S&P/ASX 200 Index settled at 4998.10, up 262.40 or +5.54%.

Asian Traders Optimistic as US Stimulus Talks Drag On

Are Asia traders chasing the U.S. markets or are they optimistic that a stimulus deal will be reached on Wednesday when their markets are closed?

With Asian market holding on to gains and U.S. futures markets down in the pre-market trade, I have to assume that the move is being fueled by a little of both.

Asian traders may be making an emotional bet on the possibility they may miss the rally if the deal is struck on Wednesday and Wall Street soars again. Meanwhile, U.S. investors are trimming a little off the top because they been duped before by the lawmakers. On Monday and Tuesday, U.S. investors were led to believe the deal was close to being struck. However, CNBC is reporting that two of their sources cautioned that talks could spill into Wednesday morning.

BREAKING NEWS

As we go to post, there are multiple reports that White House officials reached a deal with Senate leaders on a massive stimulus bill intended to cushion the economic blow of the coronavirus outbreak.

“We have a deal,” White House official Eric Ueland told reporters, according to Reuters.

This article was originally posted on FX Empire

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