Markets upbeat on Yellen's push for large fiscal stimulus

ASIAN markets on Wednesday largely responded positively after US Treasury Secretary nominee Janet Yellen made the case for president-elect Joe Biden's US$1.9 trillion relief package.

During her Senate confirmation hearing on Tuesday, she urged lawmakers to "act big", adding that help for the unemployed and small businesses would provide the "biggest bang for the buck".

In anticipation of greater stimulus, Wall Street's overnight rally on Tuesday lifted investor optimism in Asia.

Despite beginning the day on a softer note, Singapore shares picked up over the course of the trading day. The benchmark Straits Times Index (STI) inched up 0.1 per cent or 2.85 points to end at 2,998.77.

Similarly, the benchmark Kospi ended up 0.71 per cent or 21.89 points at 3,114.55. Chinese markets also rose; the Hang Seng Index gained 1.08 per cent or 320.19 points to close at 29,962.47, while the Shanghai Composite Index added 0.47 per cent or 16.71 points to end at 3,583.09.

Said Oanda senior market analyst Jeffrey Halley: "Janet Yellen made all the right noises as far as Wall Street was concerned… After a rocky start, Asian equities are staying on message and following Wall Street higher."

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He added: "Until the US Senate Republicans reveal their hand, US stimulus talk and dovishly unchanged central bank decisions around the world should continue to support equity prices."

Among the STI constituents, Yangzijiang Shipbuilding emerged as the top performer for the day. The counter closed 2.83 per cent or S$0.03 higher at S$1.09.

UOL Group came in at the bottom of the index, after falling 1.53 per cent or S$0.12 to close at S$7.71.

The trio of banks ended the day mixed. UOB was the sole lender that made gains on Wednesday, inching up 0.46 per cent or S$0.11 to close at S$23.90. DBS and OCBC, on the other hand, ended in the red. DBS slipped 0.79 per cent or S$0.21 to end at S$26.38, while OCBC closed down 0.38 per cent or S$0.04 at S$10.60.

On the broader market, advancers outnumbered decliners 302 to 205 on Wednesday, with 3.48 billion securities worth S$1.52 billion changing hands.