Asian stocks climbed to six-week highs on Monday amid signs the world economic recovery was still well on track, though rising COVID-19 cases in the region weighed on sentiment, pushing oil prices lower.
In morning trade, the Nifty 50 in India jumped about 1.2%, while the BSE Sensex advanced 1.32%.
Elsewhere regionally, the Nikkei 225 in Japan gained 0.65%, while the Topix index rose 0.38%. South Korea’s Kospi advanced 0.76%.
Mainland Chinese stocks also rose, with the Shanghai composite up 0.19% and the Shenzhen component gaining 0.548%.
Hong Kong’s Hang Seng index rose about 0.1%. Over in Australia, the S&P/ASX 200 was largely unchanged.
MSCI’s broadest index of Asia-Pacific shares outside Japan gained 0.66%.
So far, risk assets such as equities have done well, with the MSCI ex-Japan index on track for a third consecutive year of positive returns. Since April 2020, the index has offered positive returns in all but three months.
Recent data pointing to a solid global economic recovery had brought confidence in risk assets.
Early April manufacturing activity indicators out last week pointed to a robust start to the second quarter, with data hitting record highs in the US and signalling an end to Europe’s double-dip recession.
First-quarter US GDP data due later in the week is likely to show activity probably returned to pre-pandemic levels, analysts said.
“Markets have priced in the pandemic as a sprint and not a marathon. That premise could come under stress in the weeks to come,” said Jeffrey Halley, senior Asia-Pacific Market Analyst, OANDA
However, the Covid situation in India remains severe as the country continues to battle a startling rise in new coronavirus infections. On Sunday, nearly 350,000 new daily infections were registered.
Asian Markets Currencies and oil
The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 90.704, following a recent drop from above 91.2.
The Japanese yen traded at 107.68 per dollar, weaker than levels around 107.5 against the greenback seen late last week. The Australian dollar changed hands at $0.7772 against an earlier low of $0.7732.
Oil prices were lower in the afternoon of Asia trading hours, with international benchmark Brent crude futures down 0.38% to $65.86 per barrel. U.S. crude futures slipped 0.31% to $61.95 per barrel.