Asian Stock Market: Trades firmer as China state buying, US stimulus lift sentiment

• China equities extend US stimulus-backed gains in Asia-Pacific.
• Light calendar, Sino-American tussle and Aussie stimulus offer extra filters.
• US President Biden’s speech, ECB becomes the key.
• Asian shares stay on the front foot, except for Australia, as the passage of US President Joe Biden’s $1.9 trillion stimulus and upbeat Chinese equities favor bulls on early Thursday. In doing so, Asia-Pacific equities pay a little heed to fresh Sino-American jitters as well as mixed headlines from the Pacific.

While portraying the mood, MSCI’s index of Asia-Pacific shares outside Japan gains 1.74% whereas Japan’s Nikkei 225 rises 0.35% by the press time. Australia’s ASX 200 bucks the trend with mild losses as investors fear employment loss at the end of this month, due to the expiry of a jobs relief plan from the Aussie government. The cautious sentiment also spills to New Zealand as NZX 50 also prints mild losses.

Chinese equities steal the show amid alleged state-backed buying while ignoring anticipated fresh tussle between Beijing and Washington on Hong Kong row. The same lifts markets in Hong Kong, South Korea and Indonesia.

Other than the US covid relief package, up for signing on Friday, rumors that a $2.5 trillion infrastructure plan is on the way also favor the mood. As a result, S&P 500 Futures rise to the fresh high of the month above 3,900 whereas the US 10-year Treasury yields seesaw around 1.53%.

Given the upbeat sentiment and a light calendar, investors are likely to remain optimistic. Also likely to favor the mood could be receding reflation fears and hopes of positive comments from US President Biden in today’s speech. However, ECB could stall the happy-run and hence caution requires while trading.

Read: S&P 500 Futures pierce 3,900 for the first time in March as US passes Biden’s stimulus