Asian stocks win after France and Spain unveil plans to reopen

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BEIJING (AP) – Asian stock markets advanced on Wednesday after France and Spain joined governments planning to ease virus scans and allow companies to reopen.

References to Shanghai, Hong Kong, Sydney and Southeast Asia have increased. Japanese markets were closed for the holidays.

Wall Street fell back overnight, affected by declining stocks of health care and technology that were among the winners during the coronavirus pandemic.

The French and Spanish governments announced Tuesday their intention to allow the gradual reopening of restaurants and other businesses. They followed Italy, which announced similar plans on Sunday.

“The reopening of hopes continues to characterize the market despite the slight decline in Wall Street,” said Jingyi Pan of IG in a report.

The Shanghai composite index rose 0.2% to 2,814.75 and the Hong Kong Hang Seng index increased 0.1% to 24,598.00. The Kospi in Seoul rose 0.8% to 1,948.68.

The ASX-S & P 200 in Sydney gained 1.1% to 5,371.20 while the Indian Sensex opened 1.1% to 32,464.51. Singapore gained 0.3% and Jakarta gained 0.4%. New Zealand lost 0.9%.

Investors wishing to know when the deepest global recession since the 1930s could end have been encouraged by plans to reopen factories, retail and travel. But economists warn that they are overly optimistic and say there is mounting evidence that the damage is even more serious than expected.

New Zealand on Wednesday authorized the reopening of construction sites, restaurants and certain other businesses following a drop in new cases of the virus.

The South Korean government said industrial production in March had increased 4.6% from the previous month.

“We will not be receiving too many positive reports on activity in Asia in the coming months, so we should probably make the most of it,” said Rob Carnell of ING in a report.

In the United States, some governors are backing up sidewalks and allowing restaurants, hair salons and other businesses to reopen despite warnings from health experts that going too fast could lead to new epidemics.

President Donald Trump, a candidate for re-election in the midst of a crisis that has destroyed more than 10 million jobs, urges other governors to lift the bottlenecks. Gov. Andrew Cuomo of New York, one of the hardest hit and most populous states, says controls will only be relaxed after the number of new cases drops.

Elsewhere, Singapore extended its lockout for four weeks on Tuesday after reporting its highest daily balance of new cases a day earlier. India also reported a one-day record of new infections on Monday.

On Wall Street, the S&P 500 benchmark lost 0.5% to 2,863.39. The Dow Jones Industrial Average slipped 0.1% to 24,101.55. The Nasdaq, dominated by major technology stocks, lost 1.4% to 8,607.73.

Netflix, which hit records with viewers stranded at home, fell 4.2%. Other home stay winners also fell, including a 2.6% drop for Amazon and a 1.1% drop for Clorox, whose disinfectant wipes saw a surge in demand.

Many professional investors are skeptical of the big stock market rally, which pushed the S&P 500 up 28% from its March low.

They are wary of the speed with which stocks rebounded despite the gradual pace of resumption of activity.

Among the winners were travel agencies, mall owners and other businesses that were hammered after numerous orders for home stays.

Harley-Davidson jumped 15.2% after announcing plans to cut costs and conserve cash, including cutting its dividend and stopping its share buyback program. Norwegian Cruise Line increased 14.4% and Kimco Realty, which owns malls, added 9.1%.

The 10-year US Treasury yield fell to 0.61% from 0.65% on Monday evening. Yields tend to go down when investors lower economic and inflation expectations.

In the energy markets, benchmark US crude oil for June delivery gained $ 1.16 to $ 13.50 a barrel in electronic trading on the New York Mercantile Exchange. The contract lost 44 cents the previous day to $ 12.34. Brent crude oil, used to assess international oil prices, added 32 cents to $ 23.06 a barrel in London. It rose 47 cents Tuesday to $ 20.46.

The dollar fell to 106.56 yen from 106.86 yen on Tuesday. The euro was unchanged at $ 1.0847.

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