MSCI’s broadest index of Asia-Pacific shares outside Japan 0.41% rose to 588.43, for the first time since April 2022
Asian stocks rose on Tuesday to their highest in more than two and half years, boosted by a slew of Chinese stimulus measures.
In an eagerly awaited press conference, China’s top financial regulators unveiled a series of measures, saying it would cut bank reserves by 50 bps while reducing mortgage rates to try to boost sluggish economic growth.
The moves sent Chinese stocks up, with the blue-chip CSI300 Index opening 1% higher, while the broader Shanghai Composite index was also 1% higher at the open.
Hong Kong’s Hang Seng Index jumped more than 2% in early trading, with the mainland properties index soaring 5%.
That pushed MSCI’s broadest index of Asia-Pacific shares outside Japan 0.41% higher to 588.43, for the first time since April 2022.
While there was some anticipation that stimulus measures would be announced after they mentioned there was going to be a press briefing, the package of measures so far, I would say, is probably larger than what market was expecting, according to Khoon Goh, head of Asia research at ANZ.
Taken as a whole, this could help support the economy. Whether or not it is sufficient to address some of the underlying issues, especially around the lack of confidence in the economy, I think still remains to be seen, he said.
Meanwhile, investor focus will also be on the Reserve Bank of Australia’s (RBA) policy decision later in the day when it is widely expected to stand pat on rates.
The RBA is likely to stick to its hawkish stance for now, aiming to keep inflation expectations anchored, according to Charu Chanana, head of currency strategy at Saxo.
A potential pivot may come only at the November 5 meeting depending on further labour market data and the Q3 CPI report, Chanana said.
Japan’s Nikkei was the biggest mover in early trading, surging 1.4% to a near three-week high ahead of an eagerly awaited speech by BoJ Governor Kazuo Ueda.
