Hong Kong’s Hang Seng index jumps 3%, leading gains as Asia-Pacific stocks rise

Key Points

• Shares in Asia-Pacific were largely higher in Tuesday trade.
• Hong Kong’s Hang Seng index rose around 3% in Tuesday afternoon trade as Chinese tech stocks surged.
• The Reserve Bank of Australia could further increase interest rates to ensure that inflation in the country “returns to the target over time,.” minutes from the central bank’s May meeting — where it announced its first rate hike in more than a decade — showed Tuesday.

SINGAPORE — Shares in Asia-Pacific were higher in Tuesday trade as Hong Kong stocks led gains regionally.

The Hang Seng index surged 3.02% in Tuesday afternoon trade as Chinese tech stocks jumped. Tencent rose 3.26% while Alibaba soared 5.38% and Meituan gained 3.79%. The Hang Seng Tech index climbed 4.24%.

Mainland Chinese stocks edged higher on the day, with the Shanghai Composite up 0.65% to 3,093.70 while the Shenzhen Component rose 1.233% to 11,230.16.As is often the case with equity markets, when the news simply looks like it can’t get any worse, that is when market participants start seeing less bad as the new good.David Wongsenior investment strategist, AllianceBernstein

The Nikkei 225 in Japan climbed 0.42% to close at 26,659.75 while the Topix index rose 0.19% to 1,866.71.

South Korea’s Kospi gained 0.92% to end the trading day at 2,620.44 while the S&P/ASX 200 in Australia closed 0.27% higher at 7,112.50.

MSCI’s broadest index of Asia-Pacific shares outside Japan traded 1.96% higher.

“As is often the case with equity markets, when the news simply looks like it can’t get any worse, that is when market participants start seeing less bad as the new good,” David Wong, senior investment strategist at AllianceBernstein, told CNBC’s “Street Signs Asia” on Tuesday.

“When we’re looking at China, the fundamental data has been so poor and there has been so much bad news that there is I think a growing sentiment that there is going to be more policy support for the economy, for companies and for markets,” Wong said.

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Wong’s comments come as global investors have for weeks been grappling with a range of concerns from the economic impact of mainland China’s strict zero-Covid policy to fears of a potential recession in the U.S.

RBA meeting minutes released

The Reserve Bank of Australia could further increase interest rates to ensure that inflation in the country “returns to the target over time,.” minutes from the central bank’s May meeting showed Tuesday. The country had announced its first rate hike in more than a decade.

“Inflation was now above the target and was not forecast to return to the target range until mid-to-late 2024,” the minutes said. “While the significant rise in inflation had been largely the result of global factors, which were likely to have a more temporary effect on inflation, the flow of information on inflation and wages over the preceding month had been consistent with more persistent inflationary pressures arising from limited spare capacity in the domestic economy.”

TICKER	COMPANY	NAME	PRICE	CHANGE	%CHANGE
.N225	Nikkei 225 Index	*NIKKEI	26659.75	112.7	0.42
.HSI	Hang Seng Index	*HSI	20589.85	639.64	3.21
.AXJO	S&P/ASX 200	*ASX 200	7112.5	19.5	0.27
.SSEC	Shanghai	*SHANGHAI	3093.7	19.95	0.65
.KS11	KOSPI Index	*KOSPI	2620.44	23.86	0.92
.FTFCNBCA	CNBC 100 ASIA IDX	*CNBC 100	8353.6	177.92	2.18

Currencies and oil

The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 104.18 — off levels above 104.5 seen recently.

The Japanese yen traded at 129.34 per dollar, stronger as compared with levels above 130 seen against the greenback last week. The Australian dollar was at $0.6997 following a recent bounce from below $0.693.

Oil prices were lower in the afternoon of Asia trading hours, with international benchmark Brent crude futures down 0.36% to $113.83 per barrel. U.S. crude futures shed 0.46% to $113.68 per barrel.

Source : CNBC