By Joanne Chiu 

International markets and U.S. stock futures rose, as investors continued to assess the pace of economic recovery.

In Friday afternoon trading in Hong Kong, E-mini S&P 500 futures increased 0.8%, suggesting U.S. stocks could rise later in the day.

South Korea's Kospi Composite added 1.4%, Japan's Nikkei 225 closed up 0.7% and Australia's S&P/ASX 200 inched up 0.1%, meaning all three have risen every session this week. Hong Kong's main equity benchmark also rose, while the Shanghai Composite was little changed.

On Thursday, the S&P 500 broke a four-session winning streak as disappointing trade and job data showed the coronavirus pandemic's continued toll on the economy.

Equity markets and the broader economy are disconnected, said Daryl Liew, chief investment officer at REYL Singapore.

The recent stock-market surge was partly driven by massive stimulus, plus optimism over "the loosening of restrictions across the world and the expectations that we could see a V-shaped recovery," he said.

"However, we haven't really seen that in the broader economy yet," Mr. Liew said. He said if business activity doesn't rebound by the third quarter, "governments might have to do more because otherwise you're going to see a flood of bankruptcies and insolvencies."

Mr. Liew said he is holding more cash after reducing his holdings of shares because of uncertainties including potential new waves of coronavirus infections in some countries, and escalating U.S.-China tension ahead of the U.S. presidential election in November.

Lewis Wan, chief investment officer at Pride Investments Group, said he is cautious on equities following a global rebound. In dollar terms, the MSCI All Country World Index had jumped 38% as of Thursday, compared with its low on March 23, according to FactSet.

"We're probably going to see more volatility in equities until there's more certainty over the development of vaccines," and the U.S.-China relationship stabilizes, he said. Mr. Wan said any resurgence of new coronavirus infections could damage already fragile investor confidence.

The dollar continued to weaken, with the WSJ Dollar Index, which measures the U.S. currency against 16 others, declining 0.3% to 90.97. It hasn't settled below 91 since early March.

Write to Joanne Chiu at


(END) Dow Jones Newswires

June 05, 2020 03:10 ET (07:10 GMT)

Copyright (c) 2020 Dow Jones & Company, Inc.