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S&P Futures Rise; Global Stocks Mixed

By Frances Yoon 

U.S. stock futures rose, while international markets were mixed, as investors continued to weigh the prospects for economic recovery from the coronavirus pandemic.

In Wednesday morning trading in Hong Kong, E-mini S&P 500 futures were up 0.6%, suggesting U.S. stocks could open higher Wednesday. On Tuesday, doubts about a potential coronavirus vaccine helped drive the Dow Jones Industrial Average and S&P 500 down 1.6% and 1%, respectively.

Japan's Nikkei 225 and Korea's Kospi rose 0.7% and 0.1% respectively. That put both on course for their fourth straight day of gains.

Hong Kong's Hang Seng, Australia's S&P/ASX 200 and the Shanghai Composite were little changed to marginally lower, with the Shanghai index declining 0.3%.

David Chao, global market strategist for Asia Pacific ex-Japan at Invesco, said foreign and institutional funds--detecting more signs that economies in North Asia are slowly returning to normal--have recently started reallocating investments back into Asia, and particularly China.

Mr. Chao said valuations of Asia shares are also lower than those of developed-market peers, adding to investor incentives to buy the region's stocks. "Equities are expensive in developed markets like the U.S., and they're not yet out of the woods with the coronavirus," he said.

But Mr. Chao warned that escalating trade tensions between the U.S. and China, coupled with economic weakness in developed countries, could weigh on stock performances globally.

He said U.S. stocks could be volatile in the months ahead, as investors become less optimistic about a V-shaped recovery. "It feels like the calm before the summer storm," he added.

In the energy markets, West Texas Intermediate futures, the main gauge for U.S. crude oil prices, rose 1.7% to $32.36 a barrel.

The yield on the 10-year U.S. Treasury note fell 0.02 percentage point to 0.695%.

Write to Frances Yoon at frances.yoon@wsj.com

(END) Dow Jones Newswires

May 20, 2020 00:02 ET (04:02 GMT)

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