Asia stocks rebound as hopes of more stimulus offset virus worries

'Asian shares eked out gains and U.S. stock futures bounced back on Friday as hopes of more government spending around the globe outweighed concerns about rising coronavirus infections and worsening tensions between Washington and Beijing.

European shares were also expected to rise, with pan-European Euro Stoxx 50 futures, German DAX futures , Britain's FTSE futures all up 0.1-0.2%. U.S. stock futures rose 0.2%.

MSCI's broadest index of Asia-Pacific shares outside Japan advanced 0.4%, paring some of its 2% losses the previous day, while Nikkei slid 0.3% on concerns about rising virus infections in Tokyo.

In China, the CSI300 index climbed 0.25%, clawing back some of Thursday's 4.8% slide and shrugging off news that Washington is considering banning travel to the United States by all members of the Chinese Communist Party, which total more than 90 million.

Market watchers said investors are counting on U.S. policymakers to adopt more stimulus measures as the world's largest economy struggles to contain the epidemic, with some existing programmes to support businesses set to expire within weeks. 

READ MORE 

China's economy rebounds amid steep slump, US trade tensions

Oil prices fall after OPEC+ agrees to ease output curbs

Global economy not out of the woods yet: IMF

The U.S. Congress is set to begin debating such a package next week, as several states in the country's south and west implement fresh lockdown measures to curb the virus.

"You would think such sharp rises in infections would normally lead to fall in stock prices but at the moment, that was being offset by strong hopes for vaccines," said Tomo Kinoshita, global market strategist at Invesco in Tokyo.

"But we now see higher risk of a market correction, considering the improvement in hard economic data we have seen over the past couple of months is likely to halt," he said.

While retail sales for June released on Thursday beat market expectations, real-time measures of retail foot traffic and employee working hours and shifts have flatlined after steady growth since April.

The U.S. labour market remained in dire condition. There were 32 million people receiving unemployment checks under all programmes in the last week of June, down from the prior week but still the second-highest on record.

Reuters