- Equities pushed higher Tuesday fuelled by the overarching theme of vaccine rollouts, slowing infections and the easing of lockdowns.
- With Britain and the United States leading the way in rolling out vaccines as they see a sharp slowdown in new cases and deaths, there are growing calls for governments to lift strict containment measures.
- Oil also held on to gains around 13-month highs as a severe cold snap in Texas combined with expectations of a surge in demand in line with the reopening of economies.
Equities pushed higher Tuesday fuelled by the overarching theme of vaccine rollouts, slowing infections and the easing of lockdowns, as well as optimism President Joe Biden will be able to soon sign off on a vast US stimulus package.
Oil also held on to gains around 13-month highs as a severe cold snap in Texas combined with expectations of a surge in demand in line with the reopening of economies.
With Britain and the United States leading the way in rolling out vaccines at the same time as they see a sharp slowdown in new cases and deaths, there are growing calls for governments to lift strict containment measures and get life back to a semblance of normal.
The United States on Sunday reported its lowest daily infection number since October, while Britain easily hit a key target for immunising highest-risk people, while the European Union - which is struggling with its vaccine programme - has ramped up plans to deliver more jabs.
"Rapid vaccine uptake means consensus is aligned to a surge in economic activity and strong profit recovery," said Axi strategist Stephen Innes.
He added that with the Federal Reserve's ultra-loose monetary policies and Biden's stimulus on the way, "it certainly feels like the path of least resistance remains higher, as calls grow more vocal for an increase in the pace of reopening and the positive implications that would have for some areas of the market".
While Biden's spending package is widely expected to pass through the Democrat-controlled Congress, analysts have warned it might not be as big as the $1.9. trillion he proposed, though it is still expected to be north of a trillion.
Texas cold snap
Hong Kong rose more than one percent as traders returned from an extended holiday weekend, while Tokyo was also more than one percent higher a day after breaking 30 000 points for the first time in three decades.
Wellington put on more than one percent after New Zealand's government said there had been no reports of community transmission of the virus in Auckland, with the city in lockdown following the discovery of the UK strain.
Sydney, Seoul, Singapore, Manila and Jakarta were also higher. Shanghai and Taipei were closed for holidays.
David Kelly at JP Morgan Asset Management said in a note: "A combination of a receding pandemic and extra fiscal stimulus should lead to a very rapid acceleration in economic activity over the course of 2021.
"The most important unknown is the extent to which a rapid recovery, fuelled by significant and broad fiscal stimulus, could boost inflation via temporary excess demand for labour, goods and services."
But he said that while inflation will likely jump, "the Fed has made it clear that they do not intend to raise short-term interest rates until the economy has achieved 'maximum employment'".
Oil prices edged higher thanks to bets on a surge in demand as the world reopens, with WTI holding above $60 as Texas suffers freezing temperatures that have hit production, transport and power.
"Global supply is getting tighter with the US cold snap here to stay for now, and there are also expectations for demand to improve," said Will Sungchil Yun, at VI Investment Corp, adding it " doesn't look impossible" for WTI to hit $65.
On currency markets, the pound rose to a near three-year high close to $1.40 as Britain's vaccine programme speeds along.