SYDNEY- Share markets turned mixed on Monday as the US Senate passage of a $1.9 trillion stimulus bill augured well for faster global economic growth, but also put fresh pressure on Treasuries and tech stocks with lofty valuations.
The upbeat economic news continued as China’s exports surged 155 percent in February compared with a year earlier when much of the economy shut down to fight the coronavirus.
“With the Senate’s passage, we expect growth momentum to accelerate and forecast global GDP growth will surge to a 7.5 percent annualized rate in the middle quarters of the year,” said JPMorgan economists in a note.
“Every $1 trillion of fiscal stimulus adds around $4-$5 to EPS, implying 6-7 percent upside for the remainder of the year.”
However, analysts also expected a sharp acceleration in inflation, stoked in part by the latest spike in oil prices, which was pushing up bond yields and stretching equity valuations, particularly in the high tech space.
That saw Nasdaq futures reverse early gains to slip 1.0 percent, dragging S&P 500 futures down 0.2 percent.
MSCI’s broadest index of Asia-Pacific shares outside Japan followed with a fall of 0.5 percent, while Chinese blue chips .CSI300 shed 0.9 percent.
Japan’s Nikkei clung to a gain of 0.2 percent, while EUROSTOXX 50 futures were still up 0.8 percent and FTSE futures 0.9 percent.