House Democrats said they are reducing their proposal for a new stimulus package in an effort to restart negotiations with the Trump administration. Treasury Secretary Steven Mnuchin and Federal Reserve Chairman Jerome Powell said the government’s top priority should be to provide affordable loans to small businesses and additional support to millions of Americans still unemployed.
Paralyzing bias has prevented congressional renewal of aid, and the recent vacancy on the Supreme Court following the death of Judge Ruth Bader Ginsberg has deepened the gap. The renewed optimism that the larger economy could get another boost transferred into Friday trading.
“This stimulus deal has to go through,” AxiCorp’s Stephen Innes said in a comment. “With risks piling up everywhere you look, it doesn’t seem like a great time to try and pick the bottom of the equity markets, but a stimulus-easing law will go a long way in propelling the market forward.”
Japan’s Nikkei 225 benchmark gained 0.5% to close at 23,204.62. Australia’s S & P / ASX 200 gained 1.5% to 5,964.90, while South Korea’s Kospi gained 0.3% to 2,278.79. Hong Kong’s Hang Seng gave up on previous gains, falling 0.3% to 23,235.42. The Shanghai Composite Index fell 0.1% to 3,219.42.
Market momentum has recently moved at lightning speed. The US presidential election is a major factor, particularly after President Donald Trump’s refusal on Wednesday to engage in a peaceful transition of power in the event of defeat and mounting tensions between the US and China. Adding to the uncertainty is the question of how soon drug makers will be able to develop a coronavirus vaccine to stem future waves of epidemics.
On top of all the myriad concerns are the ongoing coronavirus pandemic and the threat that worsening counts around the world could lead to further restrictions on business.
In energy trading, benchmark US crude lost 35 cents to $ 39.96 a barrel in electronic trading on the New York Mercantile Exchange. Brent crude, the international standard, fell 21 cents to $ 42.25 a barrel.
The dollar rose to 105.48 Japanese yen from 105.42 yen on Thursday. The euro weakened to $ 1.1636 from $ 1.1672.
Yuri Kageyama is on Twitter at https://twitter.com/yurikageyama