Asian stocks mixed as markets await US runoff results

NEW YORK: Asian stocks were mixed on Wednesday as investors anxiously awaited results of U.S. runoff elections that would determine the legislative balance of power in the world's largest economy while oil prices rose on news of planned output cuts.

Adding to broader uncertainty in markets was the latest twist in a regulatory saga over whether the New York Stock Exchange would delist three Chinese telecom giants on security grounds.

The Shanghai SE Composite Index rose 0.73% on Tuesday after the NYSE said it would not delist the companies, however, a person familiar with the matter later said the market operator would restart delisting plans.

In Asia, futures for the S&P 500 fell 0.07%, Australian S&P/ASX 200 dipped 0.43% and Japan's Nikkei 225 inched up 0.1%.

In the United States, the tense runoff elections in the state of Georgia will decide whether President Elect Joe Biden will have the majority in the Senate he needs to support his agenda or if he will face gridlock in the early stages of his term.

Results are due on Wednesday morning and analysts say Wall Street is likely set for a rally if Republicans win and a dip if Democrats gain control. Exit poll data on Tuesday suggested extremely tight contests.

"A market pullback seems both reasonable and healthy. But stocks won’t plunge to zero because there is a countervailing positive here," said Phil Orlando, Chief Equity Market Strategist, Federated Hermes of a potential Democratic sweep.

"A Biden honeymoon with Democratic Congress helmed by Nancy Pelosi and Charles Schumer would likely lead to more fiscal stimulus and infrastructure spending. That would serve as a temporary sugar high for stocks in 2021 before the bill comes due in 2022."

Bucking the trend in Asia, South Korea's main KOSPI index surpassed 3,000 for the first time, as investors looked towards a broad recovery in exports.

Wall Street trimmed earlier gains on Tuesday as political uncertainty and the discovery of a more contagious variant of the coronavirus in major hubs like New York City tempered bullishness about the vaccine roll out.

The Dow Jones Industrial Average rose 0.55%, the S&P 500 gained 0.71% and the Nasdaq Composite added 0.95%.

MSCI's gauge of stocks across the globe gained 0.06%.

Emerging market stocks rose 1.19%. MSCI's broadest index of Asia-Pacific shares outside Japan closed 0.04% higher, while Japan's Nikkei %.

U.S. crude futures climbed 4.9% on Tuesday settling at $49.93 a barrel after Saudi Arabia pledged additional, voluntary oil output cuts. Brent crude futures also jumped 4.9%, settling at $53.60.

The dollar index fell 0.433%, against a basket of major currencies following China's decision to lift its official yuan exchange rate by its highest margin since it abandoned a dollar peg in 2005.

The benchmark U.S. 10-year notes last fell 12/32 in price to yield 0.9549%, from 0.917% late on Monday.

Bitcoin traded at $34,077.96, up 6.41%.

Spot gold XAU= added 0.4% to $1,949.46 an ounce.