Mainland Chinese blue chips gained 3.1% following a 4.3% rise in the prior session, while Hong Kong’s Hang Seng jumped 2.2%, adding to Tuesday’s 4.1% surge
Chinese stocks surged on Wednesday, lifting regional markets and helping extend a stimulus-driven global rally that also underpinned risk-sensitive currencies, while Brent crude hovered near a three-week high.
The dollar dropped after weak U.S. macroeconomic data overnight boosted the case for a second super-sized interest rate cut at the Fed’s next meeting. Gold advanced to a new all-time high.
Mainland Chinese blue chips gained 3.1% as of 0230 GMT, following a 4.3% rise in the prior session. Hong Kong’s Hang Seng jumped 2.2%, adding to Tuesday’s 4.1% surge.
The strong start for Chinese stocks revived other regional indexes, with Taiwan’s benchmark 1.3% higher and South Korea’s Kospi adding 0.1%
MSCI’s broadest index of Asia-Pacific shares outside Japan rose 1%.
Japan’s Nikkei shook off early weakness to gain 0.3%, helped by a retreat in the yen, a traditional safe haven.
The People’s Bank of China followed its announcement of wide-ranging policy easing on Tuesday with a cut to medium-term lending rates to banks on Wednesday. China’s broad-based stimulus – the biggest since the pandemic – also includes steps to boost the stock market and support for the ailing property sector.
The focus in Asia remains very much on China, UBS analysts wrote in a note to clients.
The debate remains intense on whether there are legs to this rally, though the desk is seeing investors opting to buy/short cover first and ask questions later, they added.
The yen pulled back around 0.17% to 143.47 per dollar, reversing earlier gains amid broad dollar weakness.
The euro edged up to $1.11915 after earlier pushing as far as $1.1194 for the first time in a month.
Sterling edged up to $1.3417, and earlier hit a new high since March 2022 at $1.3430.
