Asian Stocks Up, Focus on COVID-19 Economic Recovery Despite Mutant Strains Risk By

© Reuters.

By Gina Lee – Asia Pacific stocks were up Monday morning, with investors’ focus squarely on the global economic recovery from COVID-19 and upcoming earnings.

Japan’s edged up 0.14% by 10:51 PM ET (2:51 AM GMT). March’s , released earlier in the day, said that rose 16.1% year-on-year, rose 5.7% year-on-year and the stood at JPY663.7 billion.

South Korea’s was up 0.38%. In Australia, the edged up 0.15%, ahead of the releasing the minutes of its latest policy meeting on Tuesday.

Hong Kong’s rose 1.09%, even after reporting its first two cases of the mutated N501Y COVID-19 strain over the weekend. Flights into the city from India, Pakistan, and the Philippines, where numbers of COVID-19 cases are surging, have been banned for two weeks.

China’s rose 1.26% while the Shenzhen Component soared 1.92%. Asian credit markets could get a boost from a rebound inChina Huarong Asset Management Co. Ltd. (HK:) bonds, after China’s financial regulator said on Friday that China Huarong had ample liquidity in its first official comments since the company missed its deadline to report earnings.

Treasury yields steadied well below recent peaks in U.S. trade, after U.S. equity futures fell after stocks ended the previous week at a record high.

Economic data released by China and the U.S. on Friday also boosted investor sentiment, with China’s GDP growing 18.3% and 0.6% and respectively. The U.S. will also release and purchasing managers indexes on Friday.

A pullback in bond yields from recent highs has also decreased the risk of another destabilizing increase in borrowing costs.

“At the global level, you have both China and the U.S. growing fast. That’s driving markets across the globe,” Nasser Saidi & Associates president and founder Nasser Al-Saidi told Bloomberg.

“The simultaneous rally in stocks and bonds is temporary, but it suggests confidence in continued central bank support and “no fear of rapid inflation ramping up,” he added.

In Europe, the European Central Bank (ECB) will hand down its later in the week. The central bank is likely to keep the rate unchanged and to strike a cautiously optimistic tone on the economy and stabilization in borrowing rates. However, it could be too soon to expect further details on the plans for the asset purchase program beyond the second quarter of 2021.

Investors are also keeping an eye on the growing U.S.-Russia tensions over the jailing of opposition leader Alexei, or Alexey, Navalny.

In cryptocurrencies, bitcoin fell to its lowest level since February over the weekend, after reaching a record during the previous week after cryptocurrency exchange Coinbase Global Inc (NASDAQ:) listed on Nasdaq.

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