Asian Shares Rise As China Pledges To Support Economy
Asian stocks posted strong gains on Wednesday after a senior Chinese official said Beijing would provide more support for the slowing economy.
Underlying sentiment was also supported by a retreat in commodity prices and hopes for a possible diplomatic solution to the war in Ukraine.
Investors also awaited a widely anticipated interest rate decision by the U.S. Federal Reserve later in the day amid the Russia-Ukraine crisis.
The U.S. central bank likely to raise its key short-term rate by 0.25 percentage points, marking the first increase since 2018.
The Bank of England unveils its policy decision on Thursday, with the Bank of Japan following a day later.
China’s Shanghai Composite Index rallied 106.75 points, or 3.5 percent, to 3,170.71 after China’s state council vowed to keep its stock market stable amid a historic rout.
There were also reports suggesting that discussions between Chinese and U.S. regulators over cooperation on audit and regulation had made progress.
Hong Kong’s Hang Seng Index skyrocketed 1,672.42 points, or 9.1 percent, to 20,087.50, led by gains by technology stocks such as Alibaba Group Holding Ltd. and Tencent Holdings Ltd.
Japan’s Nikkei 225 Index jumped 415.53 points, or 1.6 percent, to 25,762.01 as the dollar traded near a five-year peak versus the yen and investors awaited an announcement on the lifting of Covid-19 restrictions imposed in Tokyo and 17 other prefectures.
South Korea’s Kospi gained 37.70 points, or 1.4 percent, to settle at 2,659.23, snapping a three-day losing streak as traders tracked the latest geopolitical developments. Electronics, chemical and automobile companies topped the gainers list.
Ukrainian President Volodymyr Zelenskyy said that the positions of Ukraine and Russia at peace talks were sounding more realistic but more time was needed.
Mykhailo Podolyak, an adviser to Zelenskyy, tweeted that the negotiations are “difficult” but there is room for compromise.
Australia’s benchmark S&P/ASX 200 Index rose 77.80 points, or 1.1 percent, to 7,175.20, led by gains in the tech and healthcare sectors.
Travel stocks also gained ground, with carrier Qantas Airways adding 2.2 percent as New Zealand reopened its borders. New Zealand’s NZX-50 Index ended up 72.38 points, or 0.6 percent, at 11,874.11.
Gold was little changed in Asian trading after having fallen over 1 percent to its lowest level since early March the previous day. Oil prices recovered some ground after settling below $100 a barrel on Tuesday for the first time since late February.
U.S. stocks rallied overnight as oil and industrial and agricultural commodity prices continued to fall and a report showed producer prices moderated in February, helping ease fears of inflation and a broad economic slowdown.
The Dow surged 1.8 percent, the tech-heavy Nasdaq Composite jumped 2.9 percent and the S&P 500 climbed 2.1 percent.
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