Wall Street rally continues in Asia

Asian equity markets are enjoying a very positive session today, content to coattail the impressive rally by Wall Street overnight. Overnight, US stocks booked impressive gains after Netflix had less worse results than expected, and peak inflation hopes abounded on expectations of resumed Black Sea grain exports and Russian gas exports to Europe. All-in all, it looked like Wall Street was looking for any excuse to continue the bear-market rally, and they got it.

Overnight, the S&P 500 jumped an impressive 2.73% higher, while the Nasdaq rallied by 3.09% as the Netflix results inspired investors to pile back into big tech en masse. Not to be outdone, the Dow Jones also booked a healthy 2.39% gain. In Asia, the party continues for US futures. S&P 500 futures are 0.53% higher, Nasdaq futures are rallied by 0.72%, and Dow futures have added 0.41%.

In Asia, Japan’s Nikkei 225 has jumped 2.40% higher, with South Korea’s Kospi climbing by 1.05%, and Taipei is also 1.05% higher. The rally is less impressive in mainland China thanks to rising Covid-19 cases. The Shanghai Composite is 0.67% higher, the CSI 300 has added just 0.38%, but Hong Kong’s Hang Seng has rallied 1.80% higher.

In regional markets, Singapore is 1.33% higher, with Kuala Lumpur gaining 0.55%. Jakarta has rallied by 1.80%. Manila and Bangkok have added 0.40%. Australian markets are having a strong day on the back of the US equity rally. The ASX 200 is 1.50% higher, while the All Ordinaries has rallied by 1.65%.

European markets booked another outsized session of gains overnight, following Wall Street and hitching their wagon on hopes that Putin would return Nord Stream 1 flows to normal from tomorrow. I admire their optimism, but Mr Putin appeared to pour cold water on that this morning, and I suspect it will eventually pour cold water on European equity markets’ dalliance with the world of fantasy today.

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