Asian Markets Turn Higher as U.S. Virus Cases Surge; China Markets Closed

Stocks in Asia Pacific rose in Friday morning trade as the coronavirus situation stateside continued to be monitored by investors.

In Japan, the Nikkei 225 rose 0.91% as shares of conglomerate Softbank Group jumped more than 2.5% while the Topix index added 0.73%. South Korea’s Kospi also gained 0.43%.

Hong Kong’s Hang Seng index, on the other hand, slipped 0.39% as shares of Chinese tech giant Alibaba dropped more than 2%.

Meanwhile, shares in Australia advanced, with the S&P/ASX 200 up 0.63%. Overall, the MSCI Asia ex-Japan index traded 0.25% higher.

Markets in China are closed on Friday for a holiday.

Investor reaction to the ongoing coronavirus situation in the U.S. continued to be watched on Friday, after the country suffered its single-biggest daily coronavirus cases surge on record. More than 45,000 new coronavirus cases were confirmed on Wednesday, a record that surpassed the previous April 26 peak by over 9,000 cases, according to an NBC News tally.

“The burden on healthcare systems may force city or state governments to pause reopening of their economies or reimpose city-or state-wide lockdowns,” Joseph Capuro, head of international economics at Commonwealth Bank of Australia, wrote in a note.

Still, Capurso said: “We doubt a second wave of infections will reverse the current US economic recovery. The reimposition of lockdowns in select US cities will have a much smaller economic impact than state-wide or nation-wide lockdowns.”

Meanwhile, the U.S. Federal Reserve on Thursday placed new restrictions on the banking industry after its annual stress test found that several banks could get close to minimum capital levels in scenarios related to the coronavirus pandemic. As a result, banks have to suspend share buyback programs and leave dividend payments at current levels for the third quarter.

Overnight on Wall Street, the Dow Jones Industrial Average closed 299.66 points higher, or 1.2%, at 25,745.60.  The S&P 500 finished its trading day 1.1% higher at 3,083.76 while the Nasdaq Composite also advanced 1.1% to close at 10,017.

The U.S. dollar index, which tracks the greenback against a basket of its peers, was last at 97.403 having traded at levels below 97 earlier in the trading week.

The Japanese yen traded at 107.17 per dollar following its weakening from levels below 106.8 against the greenback earlier this week. The Australian dollar was at $0.688, having risen to levels above $0.695 and traded below $0.685 this week.

Oil prices edged higher in the morning of Asian trading hours, with international benchmark Brent crude futures up 0.95% to $41.44 per barrel. U.S. crude futures also gained 0.83% to $39.04 per barrel.

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