(Bloomberg) -- U.S. stock-index futures extended gains in Asia as investors weighed the prospects of economies reopening with simmering trade tensions between Washington and Beijing.
Contracts on the S&P 500 rose to 3,000.50, the highest since March 6, as of 1:04 p.m. in Tokyo, adding to gains during overnight trading from their closing level of 2,953.00 on May 22. The underlying S&P 500 closed at 2,955.45 on Friday. U.S. financial markets were shut Monday for Memorial Day.
“It’s the grand re-opening that matters, with the S&P 500 within earshot of the psychologically fundamental 3,000 mark,” Stephen Innes, chief global markets strategist at AxiCorp, wrote in a research note. “If traders can put some headroom above that level, the view that this rally is only a bounce from oversold will most certainly give way to the wall of money argument, triggering another considerable round of bear market capitulation.”
U.S. index futures extended gains on Monday after German businesses surveyed by Ifo showed cautious optimism in May, with a gauge of expectations rising after the previous month’s plunge. The report preceded data showing South Korea’s consumer confidence jumped in May from the lowest level since the global financial crisis as progress in curbing the coronavirus outbreak somewhat eased concerns about the economy.
Japan’s stock market advanced as the nation inched toward resuming more activities Tuesday after a dropoff in virus cases led the government to end its state of emergency and bring a new focus to rebuilding a battered economy. Meanwhile, Hong Kong’s leader defended China’s moves to impose sweeping national security laws in the territory amid renewed protests and growing international concern over what it would mean for the city’s future autonomy.
“A full reopening of Japan, and vaccine hopes from the United States, has shunted Hong Kong worries to the back of the equity market’s minds,” Jeffrey Halley, senior market analyst at Oanda Asia Pacific., wrote in a note. “What is clear is that the peak-virus trade continues to maintain its strong positive momentum.”
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