ALBAWABA – Asian markets surged Tuesday with China stocks leading the rise in Hong Kong on official government promises of fresh measures to boost sluggish Chinese economy, news agencies reported.
Tech shares in Hong Kong jumped 5 percent while a China property stock gauge was on course to post the biggest gain since December, according to Bloomberg.
Other Asian markets were narrowly mixed, with the benchmark index in Australia marginally higher and Japanese equities swinging between gains and losses. Futures for European stocks slipped and contracts for the S&P 500 and the Nasdaq 100 were little changed.
China stocks ride wave of optimism
Official data in recent months showed growth in China sluggish and business activity slowing.
Beijing has come under pressure to provide much-needed support, particularly for the vast property sector, as reported by Agence France-Presse (AFP). Since then, the government issued a series of policy measures and minor interest rate cuts.
Nonetheless, investors have been largely disappointed by the policy response from authorities, as very few concrete measures were unveiled, according to AFP.
On Monday, top leaders signalled a fresh push to get the post-Covid recovery back on track.
After a meeting, the 24-person Politburo recognised "the current economic operation is facing new difficulties and challenges". They agreed they must "implement precise and effective macroeconomic regulation, strengthen countercyclical regulation and policy reserves", AFP reported.
The meeting, headed by President Xi Jinping, also called for efforts to expand domestic consumption and "adjust and optimise real estate policies in a timely manner", according to state broadcaster CCTV.
"The overall stance remains in a pro-growth mindset, but the focus is more forward-looking with an increased emphasis on addressing structural challenges (i.e. local government debt) to facilitate longer-term sustainable growth," Erin Xin at HSBC told AFP.
“For the property sector, the country’s top policymakers did not reiterate the previously-repeated message of ‘housing is for living in but not for speculation’,” Jizhou Dong, head of China property research at Nomura Holdings Inc., wrote in a note, as reported by Bloomberg.
The offshore yuan also advanced to its strongest level in more than a week after the People’s Bank of China continued its support for the currency, the New York-based news agency reported. While the commodity-heavy Australian dollar, which is sensitive to China’s growth outlook, gained 0.3 percent.
Market summary by AFP
Tokyo - Nikkei 225: DOWN 0.1 percent at 32,682.51 (close)
Hong Kong - Hang Seng Index: UP 4.1 percent at 19,434.40 (close)
Shanghai - Composite: UP 2.1 percent at 3,231.52 (close)
London - FTSE 100: FLAT at 7,677.91
Euro/dollar: UP at $1.1076 from $1.1067 on Monday
Pound/dollar: UP at $1.2861 from $1.2821
Euro/pound: DOWN at 86.12 pence from 86.29 pence
Dollar/yen: DOWN at 141.37 yen from 141.51 yen
West Texas Intermediate: DOWN 0.1 percent at $78.65 per barrel
Brent North Sea crude: DOWN 0.2 percent at $82.59 per barrel
New York - Dow: UP 0.5 percent at 35,411.24 (close)
