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  World shares near record levels as vaccines fuel normalisation hopes

Global shares traded near record highs on Friday, with Asian stocks taking their lead from Wall Street, as progress in vaccine distribution prompted bets on further normalisation in the global economy and an earnings recovery.

An index of the world’s major 50 markets, MSCI ACWI, rose 0.2% to 667.90, coming within reach of a record high of 670.82 touched about two weeks ago. It was the fifth consecutive days of gains.

MSCI’s gauge of Asian shares outside Japan rose 0.6% while Japan’s Nikkei rallied 1.5%.

Expectations of a large stimulus by U.S. President Joe Biden’s administration also supported risk sentiment while better-than-expected data on U.S. job markets released in the past two days is fanning a bullish mood ahead of the payroll report due at 1330 GMT.

·         Big Wall Street investors chased tech during GameStop retail frenzy: BofA

Deep-pocketed investors pumped a record $4.2 billion into big technology stocks last week, BofA’s flow data showed on Friday, taking advantage of the slight pullback on Wall Street while retail traders were busy buying stocks such as GameStop.

“Big client zeitgeist in past 2 weeks has unambigously been to buy the FAANMG (Facebook, Amazon, Apple, Netflix, Microsoft and Google-owner Alphabet) underperformance,” said Michael Hartnett, BofA’s chief investment strategist.

·         Japanese shares rally on upbeat earnings, U.S. stimulus hopes

Japanese shares ended more than 1% higher on Friday, following Wall Street’s rally overnight, driven by upbeat earnings from domestic firms and expectations of a large U.S. stimulus package.

Nikkei share average jumped 1.54% to 28,779.19. The broader Topix gained 1.38% at 1,890.95.

The S&P 500 and Nasdaq posted record closing highs overnight, as Democrats pushed ahead with U.S. President Joe Biden’s proposed $1.9 trillion stimulus plan without bipartisan support.

·         China shares post weekly gains on economic recovery; Sino-U.S. tensions weigh

China stocks ended higher for the week on Friday, as investors found support from a continued economic recovery, though Sino-U.S. tensions remained a worry.

The blue-chip CSI300 index rose 0.2% to 5,483.41, while the Shanghai Composite Index slipped 0.2% to 3,496.33.

For the week, CSI300 climbed 2.5%, while SSEC inched up 0.4%.

·         European markets muted as global stocks seek record highs

European stocks were mixed Friday as investors look to vaccine rollouts for hopes of normalization, while global markets flirt with record highs.

The pan-European Stoxx 600 inched around 0.15% above the flatline in early trade, with major bourses pointing in opposing directions. Travel and leisure stocks climbed 0.9% to lead gains while telecoms fell 0.5%.

·         UK market is a good place for investors to diversify from Asia: Credit Suisse

For investors who want to look beyond China and Asia, Suresh Tantia from Credit Suisse sees prospects in U.K. equities, given that much uncertainty over Brexit and vaccinations are over.

Reference: CNBC, Reuters