© Reuters. A man wearing a protective mask against the backdrop of the coronavirus epidemic (COVID-19) walks past an electronic board showing graphs (above) of the Nikkei index in front of a brokerage house in Tokyo, Japan, March 10, 2022. REUTERS / Kim Kyung-Hoon
By Stella Qiu and Alun John
BEIJING / HONG KONG (Reuters) – Asian stocks followed a global sell-off on Friday as European Central Bank interest rate hikes and concerns about upcoming US inflation inflamed fears of global growth as China’s stock rose. hopes for a loosening policy.
MSCI’s broadest Asia-Pacific equity index outside Japan fell 0.9 percent, weighed down by a 1.2 percent drop in resource-rich Australia and a 1.5 percent fall in South Korea. decreased by 1.4%.
The decline is expected to continue as European markets open. The pan-region fell 0.99%, the Germans fell 0.92% and futures fell 0.87%.
However, continued strong buying from foreign investors and cautious hopes for regulatory easing for technology companies lifted China’s shares on Friday, despite news that the cities of Beijing and Shanghai are again worried about COVID-19.
China’s blue chip index CSI300 rose 0.41 percent, while Hong Kong shares fell earlier to 0.2 percent.
The technology giants listed in Hong Kong, which suffered a severe blow at the beginning of trading, reversed losses to 0.9%, driven by the change in the state of Hong Kong shares of Alibaba (NYSE :), which rose by 1.8%.
Reuters reports that Chinese authorities have given the preliminary green light to billionaire Jack Ma’s Ant Group to resume the initial public offering (IPO), following a Bloomberg report that China is considering resuming the IPO.
Despite the refusals of the company and the securities regulator, investors took it as a sign that the long regulatory crackdown on technology companies is weakening, in line with China’s broad adjustment stance recently by leading politicians in China.
“This is a signal that Beijing has come out to tell you that they have moved from repression to support, so there is no longer much uncertainty,” said Jason Hsu, founder and CIO of Rayliant Global Advisors.
“China is now beginning to enter a circle of relief, which is definitely good for the stock market. Shares have fallen long before, so now they will rise again and offset losses. I think that’s a lot to expect. “
Factory inflation in China cooled to its slowest pace in 14 months in May due to strict restrictions on COVID-19, while consumer inflation also remained lower.
This will allow China’s central bank to release more incentives to sustain the economy, even as monetary authorities in most other countries struggle to cut inflation by aggressively raising interest rates.
On Thursday, the European Central Bank said it would make its first rate hike since 2011 next month, followed by a potentially larger move in September.
“Global stocks came under pressure after the ECB provided its guidance and (ECB President Christine) Lagarde noted risks of rising inflation,” ANZ analysts said in a note on Friday.
“And as energy prices continue to rise, it is still unclear whether inflation has peaked. Fed guidelines and political action may need to become more witty over time. Financial markets are nervous. “
Investors expect the Federal Reserve to raise interest rates by 50 basis points next week, especially if US consumer price data on Friday confirms higher inflation.
The consensus forecast projects annual inflation for May of 8.3%, unchanged from April.
Shares of Wall Street fell as the market awaited price data. The index and Nasdaq fell more than 2% in their biggest daily declines since mid-May.
In foreign exchange markets, the US dollar fell 0.2% against a basket of major currencies, retreating from its highest level three weeks before the US inflation report.
On Friday, the two-year yield, which rose with traders’ expectations of higher interest rates on Fed funds, continued to rise to move around its highest level since early May. It reached 2.8352% compared to the US close of 2.817%.
The benchmark’s yield also rose slightly to 3.0568% from a 3.042% close in the United States on Thursday.
Oil prices fell after parts of Shanghai imposed new blocking measures. fell 0.52% to $ 120.88 a barrel. fell 0.6% to $ 122.38 a barrel.
Gold fell on Friday to a weekly decline as government bond yields rose. is trading at $ 1,844.58 an ounce. [GOL/]
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