Asian markets lifted by hopes on virus but oil in retreat


HONG KONG, April 6, 2020 (BSS/AFP) – Asian markets rose Monday as some of
the world’s worst-hit countries reported falling death rates, providing some
much-needed hope in the battle against the coronavirus, though oil prices
were rocked after a meeting of top producers was delayed.

While the disease continues its deadly sweep across the planet, with more
than 1.25 million now infected and nearly 70,000 dead, news out of Europe
that fatalities were easing has lifted spirits on trading floors.

Italy reported its lowest daily toll in two weeks, while Spanish officials
said deaths fell for the third straight day and France reported its lowest
daily toll in a week.

Meanwhile, South Korea saw its fewest new cases in six weeks, while Donald
Trump said the US was showing signs of stabilising, despite the number of
cases there passing 335,000 — the highest in the world.

The virus “appears to be reaching a peak in Europe, with Italy seeing the
number of patients in intensive care falling for the second consecutive day”,
said National Australia Bank’s Tapas Strickland.

“Note, Italy imposed a countrywide lockdown on March 9, and so is
supportive of the view that the virus peaks and peters out after 15-30 days
following a strict lockdown. Focus in markets will now turn to the path out
of lockdown and to what extent containment measures can be lifted without
risking a second wave of infections.”

And Lindsey Piegza, at Stifel Nicolaus & Co., told Bloomberg TV she was
hopeful that the crisis can be brought under control and the US economy
reopened “by the end of April, early May”.

“If that does occur, it’s likely that we’re able to control the downturn
from a depressionary scenario into a recessionary scenario”.

The relatively upbeat news lifted Asian markets, which shrugged off data
Friday showing a massive drop in US jobs in March that added to news that
millions of people had applied for unemployment benefits.

Tokyo went into the break more than two percent higher, while Sydney also
piled on more than two percent on new infections in Australia showed signs of

Seoul added nearly two percent, Hong Hong was up 1.1 percent and Singapore,
Manila and Jakarta were all more than one percent higher.

– ‘A long tunnel’ –

However, observers remain cautious as the US enters what Trump said would
be “a time that’s going to be very horrendous” with “some really bad

The country’s Surgeon General Jerome Adams warned on Fox News: “This is
going to be our Pearl Harbor moment, our 9/11 moment.”

Erik Nielsen, of UniCredit SpA, said: “There is light at the end of the
tunnel but it’s still a long tunnel.”

Attention this week will be on a planned meeting of OPEC and other key
crude producers aimed at easing a supply glut that has sent oil prices

Both main contracts soared last week as Trump said Saudi Arabia and Russia
would hold talks on ending their price war, while it also emerged OPEC would
be holding a teleconference on Monday.

However, investors were dealt a blow over the weekend when the meeting was
delayed to Thursday, while analysts said there were doubts that the US would
take part in them, which could be a major sticking point for Moscow and

“If the Americans don’t take part, the problem which existed before for the
Russians and Saudis will remain — that they cut output while the US ramps it
up, and that makes the whole thing impossible,” Fyodor Lukyanov, a Kremlin
adviser, said.

But even if a deal is reached there is widespread scepticism that cuts of
10 million barrels a day that have been suggested will be enough to help the
oil market owing to the collapse in demand caused by coronavirus.

“The likelihood of a deal being done is extremely low,” Daniel Hynes, at
Australia & New Zealand Banking Group, said. “Certainly the type of agreement
you’d need to stabilise the market is a long shot given how much demand has
been hit.”

On currency markets the pound was struggling after news broke that British
Prime Minister Boris Johnson had been admitted to hospital as a
“precautionary step” as he had failed to shake off coronavirus symptoms after
10 days.

– Key figures around 0330 GMT –

Tokyo – Nikkei 225: UP 2.4 percent at 18,249.57 (break)

Hong Kong – Hang Seng: UP 1.1 percent at 23,490.02

Shanghai – Composite: Closed for a holiday

Brent North Sea crude: DOWN 3.6 percent at $32.88 per barrel

West Texas Intermediate: DOWN 5.9 percent at $26.67 per barrel

Euro/dollar: UP at $1.0811 from $1.0807 at 2030 GMT on Friday

Dollar/yen: UP at 108.87 yen from 108.42 yen

Pound/dollar: DOWN at $1.2233 from $1.2273

Euro/pound: UP at 88.40 pence from 88.04 pence

New York – Dow: DOWN 1.7 percent at 21,052.53 (close)

London – FTSE 100: DOWN 1.4 percent at 5,406.17 (close)