SYDNEY- Asian share markets edged higher on Monday while oil prices slipped as the ship blocking the Suez Canal was re-floated, raising hopes the vital waterway could reopen and ease global shipping backlogs.
The news added to optimism about world growth as markets look to President Joe Biden to outline his infrastructure spending plans this week, which could supercharge an already accelerating US recovery.
“We expect the global economy to expand robustly at 6.4 percent this year, fuelled by a large US fiscal stimulus, with positive spillovers for the rest of the world,” said Barclays economist Christian Keller.
“Rising inflation over the coming months should be transitory, and core central banks seem committed to looking through it.”
MSCI’s broadest index of Asia-Pacific shares outside Japan added 0.3 percent, with activity restrained by the approach of quarter end. Chinese blue chips rose 0.8 percent.
Japan’s Nikkei gained 1 percent, though there was some nervousness when Nomura reported its US unit could face a $2 billion loss related to a client.
There was also some caution after a $20 billion wave of block trades hit markets on Friday, reportedly linked to investment fund Archegos Capital.
For now, Nasdaq futures were off 0.6 percent and S&P 500 futures 0.5 percent. EUROSTOXX 50 futures did manage to rise 0.2 percent, while FTSE futures were flat.
The prospect of faster US economic growth has spurred speculation of rising inflation and weighed on Treasury prices. Yields on US 10-year notes eased a touch on Monday to 1.66 percent, but were still not far from the recent 13-month top of 1.754 percent.
Oil prices eased as markets assumed the re-floating of the Ever Given would allow tankers to use the waterway again. There were over 300 vessels waiting to pass through the shipping route which accounts for 12 percent of global trade.
The market will also be cautious ahead of an OPEC meeting this week, which will have to decide whether to extend supply limits, or loosen the spigots.
Brent fell 90 cents to $63.67 a barrel, while US crude lost $1.03 to $59.94 per barrel.