Asian stocks jumped as Hong Kong stocks soared more than 2 percent Wednesday, helping to lift the region after recent losses. Chinese mainland stocks climbed by the most in five months, with gains led by financials, energy, and property shares. New Zealand inflation unexpectedly rose to its highest level in more than three decades, signaling that the central bank will probably keep raising interest rates to fight inflation and support the economy in its recovery from last year’s earthquake and rebuild of Christchurch’s central business district. The kiwi dollar strengthened against its U.S.
Hong Kong’s Hang Seng index rose more than 2% on Monday
The Hang Seng grew more than 2% on Monday, leading to a gain for the Asian-Pacific region. It was a positive day for the Hang Seng index, which rose 2.47%, and Meituan and Longfor surged 6.64% and 6.43%, respectively. Mainland China markets advanced. The Shanghai Composite increased by 1.49% and the Shenzhen Component also saw an increase of 1.12%. The Korean stock exchange ended up climbing 1.78% and the Kosdaq rose 1.35%. Meanwhile, in Australia, the S&P/ASX 200 was up 0.86%. MSCI’s broadest index of shares outside Japan in the Asia-Pacific region increased by 1.46%. On Monday, Japan’s market was closed for a holiday. “A positive toe is likely to prevail in Asian trading this week, with little macro content to watch,” said ING’s Robert Carnell and Iris Pang in their note on Monday, pointing to Wall Street’s rally on Friday and positive U.S. futures.
Director of the investment strategy at OCBC
OCBC director of investment strategy Vasu Menon said he sees more downside risk for volatile markets at this point due to numerous uncertainties. “But at the same time, sentiment changes rapidly especially when you see positive economic data or positive earnings surprises, so it is a very fluid situation,” he said on CNBC’s “Squawk Box Asia” on Monday. The consumer price index rose 7.3% in New Zealand in the June 2022 quarter compared to a year earlier, official data showed Monday. That’s the highest for the country in 32 years, and it was largely driven by rising prices for construction and rents for housing, Stats NZ said.
The Reserve Bank of New Zealand raised interest rates by 50 basis points last week
Interest rates were raised by the Reserve Bank of New Zealand by 50 basis points last week. The New Zealand dollar rose 0.28% to $0.6177 on Monday. Elsewhere in the Asia-Pacific region, Macao’s government announced it would suspend all industrial, commercial and other operations through Friday.
Hong Kong casino stocks were hit by the initial announcement last week. On Friday, investors will be closely following Australia’s Reserve Bank’s minutes from the previous meeting, China’s decisions about the one-year and five-year loan prime rates, and the Bank of Japan’s decision about interest rates. The Dow Jones Industrial Average rose 600 points on Friday as markets reacted to earnings from banks and economic data. At the end of the day, the Dow was up 658.09 points or 2.15% to close at 31,288.26, the S&P 500 rose 1.92% to 3,863.16, and the Nasdaq Composite increased 1.79% to 11,452.42.
The U.S. dollar index was recently at 107.777, which is lower than 109 the week before. The Japanese yen weakened and traded at 138.37 per dollar, after plummeting last week. The Australian dollar reached a rate of $0.6808.
Oil futures regained the ground they lost earlier, rising as trade was underway in Asia. Brent crude rose 0.72% to $101.89 a barrel, while West Texas Intermediate crude rose 0.39% to $97.97 a barrel.