TOKYO/NEW YORK- Asian stocks rose on Wednesday, tracking modest Wall Street gains, as expectations that a vaccine will eventually win the battle against the coronavirus fuelled recovery hopes, while tight supply expectations pushed oil prices to a one-year high.
MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.45 percent. Chinese shares rose 0.34 percent while South Korea’s KOSPI gained 0.04 percent.
Japan’s Nikkei 225 rose 0.49 percent, but Australia’s S&P/ASX 200 bucked the regional trend and fell 0.12 percent.
US stock futures edged up by 0.15 percent.
Treasuries extended their rally in Asian trading, which pulled benchmark 10-year yields further away from the highest in almost a year and caused the yield curve to flatten slightly.
Investors were betting that the incoming Biden administration would ramp up US distribution of coronavirus vaccines, which would allow large parts of the US economy to reopen, said Peter Essele, head of portfolio management at Commonwealth Financial Network in Boston.
“The amount of pent-up demand is slowly being unwound and over the next year it is probably going to result in one the strongest growth in 20 years and markets are pricing that in,” Essele said.
“Right now, it’s a race between cases and the vaccine and the vaccine will ultimately win out and the curve will flatten out.”
On Wall Street, stocks fluctuated near unchanged for the session, not far from record highs. The Dow rose 0.19 percent, the S&P 500 gained 0.04 percent and the Nasdaq Composite added 0.28 percent.
US West Texas Intermediate (WTI) rose 0.81 percent to $53.64 a barrel, reaching the highest since February after a larger-than-expected decline in US crude inventories. Brent crude rose 0.87 percent to $57.07.