Hong Kong’s Hang Seng leads gains in Asia, mainland China stocks mixed on return from holidays

Key Points

• Shares in Asia-Pacific were mixed in Thursday morning trade.
• China’s services sector activity shrunk further in April, a private sector survey showed Thursday. The Caixin services Purchasing Managers’ Index (PMI) declined to 36.2 for April, lower than March’s reading of 42.
• The U.S. Federal Reserve on Wednesday increased its benchmark interest rate by half a percentage point, in line with market expectations.

SINGAPORE — Shares in Asia-Pacific were mixed in Thursday morning trade following the U.S. Federal Reserve’s widely expected decision overnight to hike rates by half a a percentage point — its biggest increase in two decades.

Hong Kong’s Hang Seng index led gains regionally, rising 1.17% as shares of Alibaba surged 3.06%.

Mainland Chinese stocks were mixed as they returned to trade following days of holidays. In Thursday morning trade, the Shanghai composite gained 0.51% while the Shenzhen component shed 0.51%.It was the push back on a 75bp hike from the US Fed Chair Powell that set the market rally in motion.Lavanya Venkateswaraneconomist, Mizuho Bank

China’s services sector activity shrunk further in April, a private sector survey showed Thursday. The Caixin services Purchasing Managers’ Index (PMI) declined to 36.2 for April, lower than March’s reading of 42.

The 50-point mark in PMI readings separates growth from contraction. PMI readings are sequential and represent month-on-month expansion or contraction.

Data released over the weekend also showed Chinese factory activity contracted in April as Covid lockdowns hit industrial production.

The S&P/ASX 200 in Australia climbed 0.63%, while MSCI’s broadest index of Asia-Pacific shares outside Japan traded 1.01% higher.

Markets in Japan and South Korea are closed on Thursday.

Stock picks and investing trends from CNBC Pro:

Fund manager believes FAANG is dead — says now it’s all about MANTA

These stocks should beat the market as the Fed keeps boosting short-term rates, history shows

Here’s Goldman Sachs’ playbook for trading in Latin America’s biggest market

The U.S. Federal Reserve on Wednesday increased its benchmark interest rate by half a percentage point, in line with market expectations. The central bank also outlined a program whereby it will eventually cut its bond holdings by $95 billion a month.

Fed Chair Jerome Powell emphasized the commitment to bringing inflation down, though he said a 75 basis points hike is “not something the committee is actively considering.”

Markets on Wall Street jumped overnight following the Fed decision, with the S&P 500 rising nearly 3% to 4,300.17. The Dow Jones Industrial Average surged 932.27 points, or 2.81%, to 34,061.06. The Nasdaq Composite soared 3.19% to 12,964.86.

“It was the push back on a 75bp hike from the US Fed Chair Powell that set the market rally in motion,” Lavanya Venkateswaran, an economist at Mizuho Bank, wrote in a note.

“The market reaction, mainly underscoring a repricing from the aggressive rate hikes built in, does not take away from the hawkish Fed intentions,” said Lavanya.

TICKER	COMPANY	NAME	PRICE	CHANGE	%CHANGE
.N225	Nikkei 225 Index	*NIKKEI	26818.53	-29.37	-0.11
.HSI	Hang Seng Index	*HSI	21005.08	135.56	0.65
.AXJO	S&P/ASX 200	*ASX 200	7345.2	40.5	0.55
.SSEC	Shanghai	*SHANGHAI	3073.18	26.11	0.86
.KS11	KOSPI Index	*KOSPI	2677.57	-2.89	-0.11
.FTFCNBCA	CNBC 100 ASIA IDX	*CNBC 100	8624.01	78.71	0.92

Currencies

The U.S. dollar index, which tracks the greenback against a basket of its peers, was at 102.492 following a recent decline from above 103.

The Japanese yen traded at 128.92 per dollar, stronger as compared to levels above 130 seen against the greenback yesterday. The Australian dollar changed hands at $0.7243 after a recent surge from below $0.721.

Oil prices were higher in the morning of Asia trading hours, with international benchmark Brent crude futures up 0.24% to $110.40 per barrel. U.S. crude futures climbed 0.2% to $108.03 per barrel.

Source : CNBC