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Asia report: Markets close higher, ChiNext stocks soar on new rules

Mon, 24th Aug 2020 10:01

(Sharecast News) - Markets in Asia finished higher across the board on Monday, as investors digested weekend development in the Covid-19 pandemic.
In Japan, the Nikkei 225 was up 0.28% at 22,985.51, as the yen strengthened 0.07% against the dollar to last trade at JPY 105.73.

Automation specialist Fanuc was down 0.59%, while among the benchmark's other major components, fashion firm Fast Retailing was up 1.72% and technology conglomerate SoftBank Group was 0.16% higher.

The broader Topix index was ahead 0.19% by the end of trading in Tokyo, at 1,607.13.

On the mainland the Shanghai Composite was up 0.15% at 3,385.64, and the smaller, technology-heavy Shenzhen Composite was up 1.26% at 2,278.25.

China's Nasdaq-style ChiNext board saw its first batch of equities added under a revised initial public offering (IPO) systems, with some phenomenal gains.

The new rules allow stocks to trade freely for their first five days on the bourse, after which they will be limited to 20% movements in a session - twice the 10% movements permitted previously.

Contec Medical Systems was up over 1,000%, and Ningbo KBE Electrical Technology was over 740% stronger, according to CNBC.

South Korea's Kospi added 1.1% to 2,329.83, while the Hang Seng Index in Hong Kong was up 1.74% at 25,551.58.

The blue-chip technology stocks were both higher in Seoul, with Samsung Electronics up 0.36% and chipmaker SK Hynix rising 1.34%.

On the Covid-19 front, it was reported over the weekend that the Trump administration was considering fast-tracking a UK-developed experimental vaccine ahead of the presidential election in November.

"With the US election looming large for Donald Trump, we are likely to continue seeing a proactive approach from the president as he seeks to expedite the provision of treatments and vaccines in a bid to overcome this virus before the polls open in November," said IG senior market analyst Joshua Mahony.

"Rumours of a move to fast-track the Oxford-led vaccine may have provided a boost for global market sentiment, yet significant questions remain over whether we would see significant participation without the full development process having been undertaken.

"However, this move to push through a treatment could play a crucial role in helping to bring down the casualty rate in the US, with that coronavirus response intrinsically linked to the upcoming election."

Oil prices were higher at the end of the Asian day, with Brent crude last up 0.77% at $44.69 per barrel, and West Texas Intermediate ahead 0.78% at $42.67.

In Australia, the S&P/ASX 200 was 0.3% firmer at 6,129.60, while across the Tasman Sea, New Zealand's S&P/NZX 50 added 0.72% to 11,921.07.

New Zealand's government announced during the day that the current lockdown rules in its largest city Auckland will be extended to 30 August, from a previous end date of 26 August, as health authorities continue to work to contain a resurgence of coronavirus infections.

Both of the down under dollars were stronger on the greenback, with the Aussie last ahead 0.28% at AUD 1.3915, and the Kiwi advancing 0.17% to NZD 1.5279.

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