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09.10.2020 11:03 AM
US stocks climb while Asia seeks growth points

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The major US stock indexes climbed at the closing of the trading session on Thursday. Investors continue to hope for the immediate adoption of the financial stimulus in the US as its economy is in dire need of support due to the growing negative impact of the coronavirus pandemic.

The Dow Jones Industrial Average rose 0.43% or 122.05 points, which allowed it to move to the level of 28,425.51 points. It is worth noting that the Dow Jones indicator was able to reach its maximum level over the past month.

The S&P 500 index also went up by 0.8% or 278.38 points. Its current level has stopped at around 3,446.83 points.

The NASDAQ Composite index jumped 0.5% or 56.38 points, which sent it to 11 420.98 points.

On Thursday, US President Donald Trump has asked Congress to immediately process the ratification of incentives. However, House of Representatives Speaker, Nancy Pelosi, stressed that the bill on incentive payments to airlines is unlikely to be adopted, which did not please market participants and became the main driver for the dynamics of the US stocks. This is despite the fact that Trump spoke about expanding the package of measures since there are a lot of industries affected during the pandemic. Nevertheless, it is encouraging that the negotiations have entered an active and productive stage, which should end with a decision.

Moreover, the US presidential election remains another important topic for the stock markets. Investors appreciated Donald Trump's refusal to conduct debates online with his opponent.

Meanwhile, most experts are increasingly inclined to believe that Joe Biden will win and a democratic majority will be formed in both houses of Congress. In this case, there is even more hope for the adoption of a full-scale financial incentive program, as well as for the introduction of an increased tax rate. Of course, all this may cause markets to weaken, but it will not be that long as stabilization will follow quite quickly.

News about economic growth in the US also turned out to be more positive than previously thought. The head of the Kansas City Fed announced that the country's recovery from the crisis is accelerating and ahead of earlier forecasts. However, whether this will happen in the future, no one can guess, because the new wave of the pandemic continues to frighten the world. There are still a huge number of risks for the financial sector that can be realized at any time. The crisis has not yet been overcome, so it is still too early to draw any conclusions.

Asian stock exchanges, on the other hand, recorded multidirectional dynamics Friday morning. And even the good news from overseas concerning the progress on the negotiation process on the financial incentives in the US did not affect its movement.

The high volatility in the region's stock markets which began in mid-September continues as of present. There is not too much optimism about the stimulus program, much less about the US presidential elections. Of course, against the background of such ambiguous events, we can hardly expect strong growth in the stock markets.

Japan's Nikkei 225 index fell 0.3%. There are not very positive statistics on the growth of the country's economy. The level of consumer spending decreased by 6.9% on an annual basis, but the previous figure remains worst at 7.6%.

China's Shanghai Composite index, on the other hand, rose quite well by 1.7%. Hong Kong's Hang Seng index did not support the positive trend which declined by 0.01%. The PMI index in the service sector in the first month of autumn rose quite well at 54.8 points which was previously at 54 points.

Stock exchanges in South Korea are closed on Friday due to holidays.

The Australian index S & P / ASX 200 remained without any dynamics at all.

Maria Shablon,
Pakar analisis InstaForex
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