GLOBAL MARKETS-Stocks and sterling pin hopes on Brexit, regulator probe stings Alibaba
* Stocks receive progress on Brexit trade talk
* Sterling benefits as deal appears close
* Alibaba pounded as Chinese regulators circled
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By Stanley White and John McCrank
TOKYO / NEW YORK, Dec 24 (Reuters) - Asian stocks and the British pound rose on the Thursday before the Christmas break as the UK and European Union signed a free trade agreement and investors placed bets on the prospects of a global economic recovery.
The broadest MSCI index for stocks in Asia Pacific outside Japan rose 0.45%. Australian stocks rose 0.33% while Tokyo stocks rose 0.45%.
Chinese stocks fell 0.28%.
Alibaba Group Holding Ltd shares plunged 8.13%, the largest daily drop in six weeks after China's market regulator announced it was investigating the tech giant for suspected monopoly behavior.
The US stock futures gained 0.16%.
The FTSE futures were up 0.56%. The Euro Stoxx 50 futures rose 1.15% while the German DAX futures rose 1.28%, indicating a good start to the European session.
Investors welcomed the news that on Thursday the UK and the European Union were on the verge of signing a close trade deal that would help them avoid a tumultuous economic rupture on New Years Day.
Hopes for more household spending and expectations for coronavirus vaccines to become more available in the next year also supported global stocks.
"A risky and weak dollar theme dominated the markets on optimism about vaccines, fiscal stimulus in the US and UK and Brexit, with the hope that an agreement can be reached before Christmas," wrote analysts at ANZ Bank in a research memo.
The potential for a Brexit deal added to the pound sterling, which rose 0.47% to $ 1.3558. The pound rose to 90.05 pence per euro.
The pound also found support after France lifted its UK freight ban, which it put in place in response to a more contagious variant of coronavirus in the UK.
MSCI's view on global stocks rose 0.12%, but moves in Thin Holiday trading were subdued.
Alibaba, which was co-founded by Chinese billionaire Jack Ma, was the stock that was seen in Asia on Thursday as Chinese authorities stepped up their campaign against large tech companies.
Separately, Ant Group, the mobile payments and consumer credit arm of Ma's tech empire, said it will meet all regulatory requirements after China's financial watchdogs announced they would have regulatory talks with it in the coming days.
Last month, China halted the $ 37 billion double-listing of the Ant Group, suppressing the world's largest public offering.
Wall Street ended largely higher on Wednesday, with the Dow Jones Industrial Average up 0.38% and the S&P 500 up 0.07%. The Nasdaq Composite was down 0.29%.
A series of mixed US economic data showed lower jobless claims and a surge in durable goods orders, but also a decline in consumer spending, falling personal incomes, and fading sentiment as the holiday shopping season draws to a close with a resurgent pandemic.
Investors largely shook off US President Donald Trump's comments that a nearly $ 900 billion stimulus package agreed after months of fighting in Congress was "a shame" that he may not sign.
"Risk sentiment still guides the markets to this day, and it appears to be geared more towards possible optimism about a Brexit deal and the cherry-picked pieces of US releases than Trump's reckless antics in signing the stimulus and funding bill." he told Derek Holt, head of capital markets economics at Scotiabank.
Brent crude oil futures rose 38 cents to $ 51.58 a barrel by 0530 GMT, while U.S. West Texas Intermediate crude rose 31 cents to $ 48.43. (Reporting by Stanley White and John McCrank, with additional reporting by April Joyner; editing by Sam Holmes and Himani Sarkar)
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