Investing.com – Asian stocks were mostly up on Wednesday morning, with China’s economy continuing to maintain its recovery and Americans tuning into the ongoing, heated U.S. presidential debate between President Donald Trump and Democrat Joe Biden.
Trump, currently trailing in the polls, “really needs to outperform tonight,” Rockefeller & Co LLC senior portfolio manager Jimmy Chang said on Bloomberg.
“The market is starting to price in potentially a blue sweep,” in reference to a scenario where the Democrats win both houses of Congress and the White House, implying higher taxes but also more stimulus which would boost reflationary trends and weaken the dollar, Chang added.
Investors were also rebalancing their portfolios on the last trading day of the month and the third quarter.
China’s Shanghai Composite rose 0.54% by 10:23 PM ET (2:23 AM GMT) and the Shenzhen Component was up 0.51% ahead a week-long holiday. Chinese data released earlier in the day showed that the world’s second largest economy continues to progress its recovery, with purchasing managers indexes (PMIs) for September remaining above the 50-mark separating growth from contraction.
The manufacturing PMI was 51.5, beating the forecast 51.2 and August’s 51 readings. The non-manufacturing PMI was 55.9 against August’s 55.2. However, the Caixin manufacturing PMI of 53 was slightly under the forecast 53.1 and August’s 53.1 figures.
South Korea’s markets were closed for a holiday.
Investors are also hopeful that the U.S. Congress will pass the $2.2 trillion stimulus package proposed by the Democrats before November’s presidential election. U.S. House of Representative Speaker Nancy Pelosi said on Tuesday that she is hopeful that a deal will be reached by the end of the week and talks with Treasury Secretary Steve Mnuchin scheduled later in the day.
With the pandemic’s global death toll exceeding 1 million and the number of cases ticking up in many jurisdictions, investors are also placing their hopes on the Democrat stimulus proposal to help support economic growth.