Shares across much of Asia joined a global rally and futures pointed to further gains on Wall Street, as sentiment was brightened by signs US politicians are making progress toward new economic support measures.

Hong Kong’s benchmark Hang Seng climbed 0.5 per cent while China’s CSI 300 index of Shanghai- and Shenzhen-listed stocks rose 0.3 per cent. Australia’s S&P/ASX 200 added 0.3 per cent and South Korea’s Kospi advanced 0.6 per cent.

The moves in Asia came after Democrats unveiled a $2.2tn coronavirus economic relief bill in a bid to reach a compromise with Republicans after weeks of wrangling to restore expanded jobless benefits that expired earlier this year.

The advance also followed the best day for European stocks in three months and a rebound on Wall Street led by financials, with the S&P 500 rising 1.6 per cent and the FTSE 100 finishing 1.5 per cent higher. The Euro Stoxx 600 closed 2.2 per cent higher, its best one-day rise in three months.

However, some caution was evident ahead of the first US presidential debate between incumbent Donald Trump and Joe Biden, his Democrat rival, later on Tuesday.

Futures markets tipped US stocks to edge higher, with the S&P 500 expected to climb 0.2 per cent, while the FTSE 100 was set to shed 0.1 per cent.

The “FTSE 100 is looking more and more interesting,” said JPMorgan strategist Mislav Matejka. He said the Brexit risk to the pound, which is down 4 per cent against the US dollar this month, made British stocks more attractive to foreign buyers and that FTSE 100 valuations were at “record cheap levels”.

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“We think the peak of dividend cancellations is behind us,” Mr Matejka added.

However, telecoms shares led Japanese equities lower on Tuesday after Nippon Telegraph and Telephone Corp announced plans to take NTT DoCoMo, its wireless carrier, private.

The benchmark Topix was down 0.7 per cent. The prospect of lower fees at NTT, which also fell 4 per cent, weighed on shares in the telecoms sector, with KDDI and SoftBank off 3.2 per cent and 3.8 per cent, respectively.

Japanese stocks were also pulling back from their highest closing level since February on Tuesday as traders said investors were selling to book profits ahead of the end of the third quarter.

Additional reporting by Leo Lewis in Tokyo

Via Financial Times