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World markets mostly higher on hopes for coronavirus vaccine

World markets mostly higher on hopes for coronavirus vaccine
Japan Financial Markets

A man walks past an electronic stock board showing Japan’s Nikkei 225 and New York Dow indexes at a securities firm in Tokyo Wednesday, July 15, 2020. Shares were mostly higher in Asia on Wednesday as investors were encouraged by news that an experimental COVID-19 vaccine under development by Moderna and the U.S. National Institutes of Health revved up people’s immune systems just as desired. (AP Photo/Eugene Hoshiko)

Shares rose in global markets on Wednesday as investors took heart from news that an experimental COVID-19 vaccine had revved up people’s immune systems just as desired.

Benchmarks rose in Paris, Frankfurt and Tokyo and U.S. futures also saw sold gains, suggesting a rise on the open on Wall Street.

The focus was on news that scientists soon will begin a 30,000-person study to see if the experimental vaccine developed by Moderna and the U.S. National Institutes of Health is strong enough to protect against the coronavirus.

Upbeat corporate earnings were helping support markets, “But the cherry on top has to be the positive virus vaccine update as optimism on the vaccine is more than a show stopper. It’s the ultimate recession stopper,” Stephen Innes of AxiCorp said in a commentary.

“The positive coverage on a potential COVID-19 vaccine represents a rotating carousel of positive news that is overwhelming rising virus cases in the U.S.,” he said.

Germany’s DAX climbed 1.8% to 12,924 while the CAC 40 in Paris advanced 2.4% to 5,127. Britain’s FTSE 100 picked up 2% to 6,302. The future for the S&P 500 gained 1.3% while that for the Dow industrials rose 1.9%.

News about the vaccine came after the end of trading for U.S. markets on Tuesday.

Tokyo’s Nikkei 225 advanced 1.6% to 22,945.50 after the Bank of Japan kept its ultra-easy monetary stance unchanged as it wrapped up a policy meeting. It forecast that the economy would improve later in the year, assuming there is no major “second wave” of outbreaks of the new coronavirus.

But the central back acknowledged very high uncertainty over the outlook for the world’s third largest economy. The bank’s growth forecast for the year was downgraded to minus 5.7%- minus 4.5% from the earlier forecast of minus 5%-minus 3%.

Hong Kong’s Hang Seng was nearly unchanged at 25,481.58, while the Shanghai Composite Index slipped 1.6% to 3,361.30 after President Donald Trump signed a bill and executive order that he says will hold China accountable for its oppressive actions against the people of Hong Kong.

The legislation and order are part of an escalating diplomatic offensive against China that is adding to chronic tensions over trade and other issues.

In other Asian trading, the Kospi in South Korea added 0.8% to 2,201.96. In Australia, the S&P/ASX 200 gained 1.9% to 6,052.90. India’s Sensex jumped 1.8% to 36,680.77. Shares rose in Taiwan and were mixed in Southeast Asia.

Benchmark U.S. crude oil rose 61 cents to $40.90 per barrel in electronic trading on the New York Mercantile Exchange. It gained 19 cents to settle at $40.29 per barrel on Tuesday. Brent oil, the international standard, picked up 49 cents to $43.39 per barrel. It rose 18 cents to $42.90 a barrel in London.

In currency dealings, the dollar weakened to 106.83 Japanese yen from 107.23 yen late Tuesday. The euro climbed to $1.1442 from $1.1401.

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