Asia stocks rise, spurred by hopes for COVID treatment

Business

A man looks at an electronic stock board showing Japan’s Nikkei 225 index at a securities firm in Tokyo Monday, Aug. 24, 2020. Asian stock markets rose Monday after Wall Street hit a new high despite lingering unease about a possible second wave of coronavirus infections. (AP Photo/Eugene Hoshiko)

TOKYO (AP) — Asian shares were mostly higher Tuesday as investors hung onto hopes the coronavirus pandemic may come under control as treatments get developed.

“The positive coverage on potential COVID-19 vaccines and treatments opens the door wide open to a rotating carousel of stocks,” said Stephen Innes, chief global markets strategist at AxiCorp.

If symptoms of the infection could become as mild as a cough or runny nose during a flu, the economy could return to normal, he added.

Japan’s benchmark Nikkei 225 index rose 1.7% to 23,378.47. South Korea’s Kospi gained 1.5% to 2,364.25. Australia’s S&P/ASX 200 added 0.5% to 6,159.60. Hong Kong’s Hang Seng edged down 0.2% to 25,498.77, while the Shanghai Composite was up 0.2% at 3,392.49.

Investors are also awaiting a speech by U.S. Federal Reserve Chair Jerome Powell later this week that he would normally give at Jackson Hole, Wyoming. This year’s economic policy symposium will be online due to the pandemic.

Investors closely follow speeches at the annual Jackson Hole event, where Fed officials sometimes generate market-moving headlines. This year’s event is titled “Navigating the Decade Ahead: Implications for Monetary Policy.”

While signs that the increase in COVID-19 cases around the world may be slowing down gradually are cause for optimism, worries about recurring waves remain.

“The news that a Hong Kong man has been proven to be reinfected with COVID-19 means that the assumption of the market that it is only a matter of time before a vaccine comes and brings back the old life again, is more questionable,” said Robert Carnell, regional head of research, Asia Pacific, at ING.

“But perhaps we should be tempering our optimism,” he said.

On Wall Street, the S&P 500 rallied 1% to 3,431.28 and added to the all-time high it set last week. The Dow Jones Industrial Average rose 1.4% to 28,308.46, and the Nasdaq composite added 0.6% to 11,379.72.

Pharmaceutical companies working toward a possible vaccine for COVID-19 is helping invigorate shares of industries that have been beaten by the pandemic. Airlines climbed, for example, amid the possibility that people may feel safe enough to travel again in the future. Delta Air Lines rose 9.3%, and American Airlines Group added 10.5%.

One winner of the new normal, Zoom Video Communications, stumbled. Its shares fell 2.6% after it reported partial outages in its Zoom Meetings service, which has become the default way for classrooms and businesses around the world to communicate. By midday on the East Coast, it said it had resolved the issue.

Also Monday, it was announced that some big names in the Dow Jones Industrial Average are slated to be dropped from the 30-company index. Exxon Mobil, Pfizer and Raytheon Technologies will be replaced before trading opens next Monday by Salesforce.com, Amgen and Honeywell International.

Benchmark U.S. crude oil slipped 5 cents to $42.57 a barrel in electronic trading on the New York Mercantile Exchange. It rose 28 cents to $42.62 per barrel Monday. Brent crude, the international standard, rose 11 cents to $45.24 a barrel.

The dollar inched up to 105.90 Japanese yen from 105.82 yen. The euro cost $1.1805, down from $1.1817.

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AP Business Writers Stan Choe and Damian J. Troise contributed. Yuri Kageyama is on Twitter https://twitter.com/yurikageyama

Copyright 2020 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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