The Asian markets have continued their rally following Wall Street’s advance, suggesting investors are shrugging of coronavirus fears.

Shares advanced across Asia on Tuesday after Wall Street closed broadly higher on encouraging economic reports, starting off August by closing within 3% of the record high it set in February.

Tokyo’s Nikkei 225 gained 1.4% to 22,505.83 and the Hang Seng in Hong Kong added 0.7% to 24,637.24.

The S&P 500 added another 0.7% onto its four-month winning streak, closing within 3% of the record high it set in February at 3,294.61.

Big Tech led the way higher again, and Microsoft and Apple alone accounted for most of the S&P 500’s gain.

The rally followed reports showing that manufacturing has improved across much of the world, including in China, Europe and the United States.

Hopes rose that the US might avoid a deeper recession

Jeffrey Helley

With the total coronavirus caseload rising by less than 50,000 for two straight days, investors bet that US outbreaks might be moderating, said Jeffrey Halley of Oanda.

“Hopes rose that the US might avoid a deeper recession, which was all financial markets needed to send equity markets higher, and for the US dollar to continue recovering some of its recent losses,” Mr Halley said.

Microsoft jumped 5.6% on Monday after it confirmed that it is in talks to buy the US arm of TikTok, a Chinese-owned video app that is very popular but has also drawn the White House’s scrutiny.

Microsoft said its chief executive officer Satya Nadella has discussed the issue with President Donald Trump, and the tech giant expects the talks with TikTok to end no later than September 15, either with a deal or without.

Apple added 2.5%, piling more gains onto its 10.5% rise on Friday following a report showing that its profits during the spring easily topped Wall Street’s expectations.