By Associated Press
BANGKOK — Stocks advanced Wednesday in Asia after another broad rally on Wall Street as investors wagered that the new variant of the COVID-19 virus won’t pose a big threat to the economy.
Tokyo’s Nikkei 225 index /zigman2/quotes/210597971/delayed JP:NIK +2.09% gained 1.5% and the Shanghai Composite index /zigman2/quotes/210598127/delayed CN:SHCOMP -0.97% climbed 0.9%. Hong Kong’s Hang Seng /zigman2/quotes/210598030/delayed HK:HSI -1.08% slipped 0.1%.
In Australia, the S&P/ASX 200 /zigman2/quotes/210598100/delayed AU:XJO +2.19% jumped 1.2%, while the Kospi /zigman2/quotes/210598069/delayed KR:180721 +1.87% in South Korea surged 1%. Stocks retreated in Singapore /zigman2/quotes/210597985/delayed SG:STI -0.42% , but rose in Taiwan /zigman2/quotes/210597977/delayed TW:Y9999 -0.15% and Indonesia /zigman2/quotes/210597981/delayed ID:JAKIDX +0.52% .
Japan downgraded its growth estimate for the last quarter to minus-3.6% from an earlier reported contraction of 3.0%. The change reflected weaker consumer and public demand and trade and lower levels of private inventories.
Economists are forecasting a rebound in the current quarter, thanks to a recovery in activity as coronavirus caseloads plummeted.
Japan’s Parliament is expected to approve a proposed record stimulus package of 56 trillion yen ($490 billion), including cash handouts and aid to ailing businesses, to help the economy out of the doldrums worsened by the coronavirus pandemic.
On Tuesday, the S&P 500 /zigman2/quotes/210599714/realtime SPX +0.92% rose 2.1% for its biggest gain since March, ending at 4,686.75. The Nasdaq /zigman2/quotes/210598365/realtime COMP +1.55% climbed 3% to 15,686.92 and the Dow Jones Industrials /zigman2/quotes/210598065/realtime DJIA +0.28% rose 1.4% to 35,719.43.
The rebound this week comes after the market posted two losing weeks in a row, weighed down by concerns over the spread of the omicron variant of COVID-19, mixed data on the job market and worries about inflation.
Comments Monday from Dr. Anthony Fauci, the White House’s chief medical adviser, who said early indications suggest the omicron variant of coronavirus may be less dangerous than the delta variant have encouraged investors.
It will take a few more weeks to learn whether omicron is more contagious, causes more severe illness or evades immunity.
Beyond any lingering uncertainty over omicron, Wall Street is looking ahead to next week, when the Federal Reserve is scheduled to hold a two-day meeting of policymakers that could offer an update on the central bank’s plans to tackle inflation. The Fed has said it plans to speed up the pace at which it trims its bond purchases, which have helped keep interest rates low. That has raised concerns that the Fed will raise its benchmark interest rates next year sooner than expected.
On Wednesday, oil prices fell back, with U.S. benchmark crude losing 29 cents to $71.76 per barrel. Brent crude , the standard for pricing international oils, gave up 30 cents to $75.14 per barrel.
The yield on the 10-year Treasury slipped to 1.46% from 1.48% late Tuesday. It fell to 1.34% on Friday as anxious investors sold stocks and piled into bonds.
In currency trading, the U.S. dollar /zigman2/quotes/210561789/realtime/sampled USDJPY -0.1508% slipped to 113.48 Japanese yen from 113.59 yen.