* Asian stock markets: https://tmsnrt.rs/2zpUAr4
* MSCI ex-Japan jumps to its highest level since January 2018
* E-Mini-Futures for S&P 500 increase by more than 1.5%
* Markets trade after Biden’s victory and the Republican Senate
* Oil prices exceed $ 40 a barrel
From Swati Pandey
SYDNEY, November 9 (Reuters). Stocks rose, oil prices rose, and the dollar remained weak on Monday as expectation of less regulatory changes and more monetary stimulus under US President-elect Joe Biden helped risk appetite.
The Democratic candidate’s victory in the US presidential election was largely priced in by the markets that have traded under the view of a Biden presidency and a Republican-controlled US Senate since last week.
E-mini futures for the S&P 500 rose more than 1.5% on Monday while the Nasdaq futures rose over 2%, signaling a positive start for US markets.
MSCI’s broadest index for stocks in the Asia-Pacific region outside Japan rose 1.3% to 613.95 points, its highest level since January 2018. It was up 6.2% last week, its best weekly performance since early June to achieve.
“While a lot of attention has been paid to Trump versus Biden, the markets have reacted strongly to the (likely) split congress, which means more confidence that interest rates will be lower for longer,” said Dave Wang, portfolio manager at Nuveen Capital in Singapore.
“The best opportunities now lie in emerging market segments, especially China and North Asia. I believe that earnings momentum and valuation have put China in a very attractive risk / reward position.”
Chinese stocks rose 1% on the blue-chip CSI300 index in hopes of better trade ties between China and the US under Biden.
Japan rose 2% while the main indices of Australia, Hong Kong and South Korea gained 1.7% each.
National Australia Bank analyst Tapas Strickland said stocks rebounded sharply last week, with the S&P500 gaining 7.3% and posting its best earnings in an election week since 1932.
However, Matt Sherwood of Australian fund manager Perpetual said Biden’s win did not necessarily justify optimizing his portfolio.
“Ultimately, we think the US economy is still pretty fragile and that growth is slowing,” said Sherwood.
“You could potentially focus your portfolio more on higher beta markets like emerging markets, and there is the potential for better prospects in the energy sector than would have been a clean sweep by the Democrats.”
Oil prices rose on Monday as investors cheered Biden’s victory and shook off worries over weak demand amid rising coronavirus cases around the world.
Brent Crude added $ 1 to $ 40.48.
Analysts warned that the path could become more difficult from here as investors focus on Biden’s ability to expand fiscal incentives and measures to reduce the spread of COVID-19.
The United States saw a record number of new coronavirus infections last week, with the total number of cases approaching 10 million.
US-based wealth manager Jim Wilding of Confluence Financial Partners in Pennsylvania warned the S&P 500 not far from all-time highs and stock valuations, which are generally at heady levels.
“While we remain positive over the medium term, believing that a divided government will reduce the likelihood of a bear fall scenario, we would refrain from unbridled enthusiasm at current levels,” he noted.
According to analysts, despite a divided government, a fiscal stimulus plan is still possible, although a larger package is less likely. This puts the US Federal Reserve in the spotlight, doing more to strengthen the world’s largest economy.
As a result, the dollar has weakened in the past few days while growth reps like the Australian dollar have rallied with Biden’s presidency, which is less likely to face trading.
The dollar was mostly flat against the Japanese yen at 103.31 after falling 1.3% last week.
The Aussie was up 0.2% after rising 3.3% last week.
Investor focus will also be on sterling and euro this week. Trade negotiations between the UK and the EU will come to a head with the EU summit on November 15th.
Later in the day, the Bank of England’s chief economist will deliver a speech on “The economic impact of the coronavirus and the long-term impact on the UK”
The euro, which was up 1.9% last week, was slightly higher on Monday at $ 1.1887. The pound sterling rose to $ 1.3183.
(Reporting by Swati Pandey in Sydney; Additional reporting by Tom Westbrook and Michelle Price; Editing by Daniel Wallis and Sam Holmes)