Markets upbeat on Yellen's push for large fiscal stimulus

US Treasury Secretary nominee Janet Yellen had urged lawmakers to "act big".
US Treasury Secretary nominee Janet Yellen had urged lawmakers to "act big".PHOTO: REUTERS

SINGAPORE (THE BUSINESS TIMES) - Regional investors were generally won over on Wednesday when United States Treasury Secretary nominee Janet Yellen made the case for President Joe Biden's US$1.9 trillion (S$ 2.5 trillion) relief package.

Dr Yellen urged lawmakers to "act big", adding that help for the unemployed and small businesses would provide the "biggest bang for the buck".

The promise of greater stimulus fuelled Wall Street's overnight rally and lifted optimism in Asia.

Despite beginning the day on a softer note, the Straits Times Index (STI) picked up over the course of the session to inch up 0.1 per cent, or 2.85 points, to 2,998.77.

Gainers outnumbered losers 302 to 205, with 3.48 billion shares worth $1.52 billion changing hands.

Similarly, the benchmark Kospi in Seoul ended up 0.71 per cent and Chinese markets also rose - the Hang Seng Index gained 1.08 per cent, while the Shanghai Composite added 0.47 per cent.

Oanda senior market analyst Jeffrey Halley said: "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. 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."

Yangzijiang Shipbuilding was the STI's top performer, closing 2.83 per cent higher at $1.09. UOL Group came in at the bottom of the index, falling 1.53 per cent to $7.71.

The trio of banks ended the day mixed. UOB was the sole lender that made gains, inching up 0.46 per cent to $23.90. However, DBS Bank and OCBC Bank ended in the red. DBS slipped 0.79 per cent to $26.38, while OCBC closed down 0.38 per cent at $10.60.