SINGAPORE- Asian stocks rallied on Thursday, bonds nursed losses and oil held onto sharp gains as investors seemed to set aside virus jitters for now and looked ahead to the European Central Bank for reassurance that policy support will continue for some time.
MSCI’s broadest index of Asia-Pacific shares outside Japan followed Wall Street higher and rose 1 percent with broad gains from Sydney to Seoul and Hong Kong. Japanese markets are closed until Monday.
There was no obvious catalyst for the recent rebound in stocks, or the drawdown on Friday and Monday, though a study on Wednesday showed both Pfizer and AstraZeneca vaccines were effective against the Delta coronavirus variant.
“Every now and then investors look for reasons to take some profits off and that’s what we saw,” said Jun Bei Liu, portfolio manager at Tribeca Investment Partners in Sydney.
“The market suddenly became worried about the delta variant and how it might affect the path to recovery,” she said. “But what we have compared with 12 months ago is quite a few viable vaccines…eventually we will be coming out of this and we are much closer to the end than we were 12 months ago.”
Still, unlike Wall Street, most Asian indexes struggled to recoup early-week losses as Asia contends with burgeoning outbreaks in unvaccinated populations and as nerves persist around China’s regulatory crackdown on technology firms.
Shares in heavily-indebted Chinese property developer Evergrande rebounded about 11 percent in Hong Kong after it said it had resolved legal disputes with a lender.