Asian stocks struggled to find momentum on Thursday with investors playing the waiting game ahead of stronger signals on US interest rates and news on more stimulus measures by Beijing.
Confidence is growing that interest rates globally will head lower next year but traders are also looking to Chinese policymakers for clues on possible support for its long-suffering property market.
China has reportedly placed debt-laden Country Garden Holdings Co on a draft list of 50 developers eligible for a range of financing support. Other distressed developers, such as Sino-Ocean Group and CIFI Holdings are also on the list.
Also on AF: China Wealth Manager Zhongzhi Admits to $64 Billion in Liabilities
But China stocks still struggled for direction as investors remained cautious on the overall recovery prospects for the world’s No2 economy.
The blue-chip CSI 300 Index rose 0.48%, while the Shanghai Composite Index rose 0.60%, or 18.25 points, to 3,061.86. The Shenzhen Composite Index on China’s second exchange edged up 0.82%, or 15.63 points, to 1,921.43.
Tech giants listed in Hong Kong were up 0.5%, while the Hang Seng Mainland Properties Index jumped 4.3%. The benchmark Hang Seng Index gained 0.99%, or 176.24 points, to close at 17,910.84.
Meanwhile, a top Alibaba executive told staff on Wednesday that it was a “coincidence” that a plan by former chief Jack Ma’s family trust to sell some shares in firm was disclosed on the same day the firm scrapped its cloud unit’s listing, in a move seen as an effort to quell ongoing unease within the e-commerce giant.
Elsewhere across the region, in earlier trade, Shanghai, Seoul, Wellington and Jakarta also rose but Sydney, Singapore, Mumbai, Taipei, Manila and Bangkok were in retreat.
MSCI’s broadest index of Asia-Pacific shares outside Japan edged down 0.03% in thin trading, with Japan and the United States on holiday.
US Rate Cuts Uncertainty
The US market, which has priced out the chances of another rate hike in December, shrugged off strong weekly jobs data on Wednesday night that may nevertheless reduce the prospects for quicker-than-expected rate cuts by the Federal Reserve, said Redmond Wong, Greater China market strategist at Saxo Markets.
Markets have generally been buoyant this month, with stocks rallying on expectations of a more benign interest rate backdrop.
Wall Street’s benchmark S&P 500 is nearing a fresh high for 2023, with the S&P 500 and MSCI’s all-country index both up more than 8% this month alone. The tech-heavy Nasdaq Composite is up 11% for the month.
The next set of forward-looking flash November PMIs will help investors to assess recession risks and how quickly rate cuts might begin.
The minutes of the European Central Bank’s October meeting and flash PMIs for a host of European countries are Thursday’s highlights. US PMI data is due out on Friday.
The PMIs for the euro zone and Britain are already below the 50 threshold, suggesting that economic activity is contracting, while the US October manufacturing PMI contracted sharply.
Dollar Posts Gains
The yield on benchmark 10-year notes was at 4.408% on Thursday, after sliding to a two-month low of 4.363%.
The dollar index rose overnight, bouncing from a 10-week low after data showed the number of Americans filing new claims for unemployment benefits fell more than expected last week.
US crude fell 1.14% to $76.22 per barrel and Brent was at $80.92, down 1.27%, extending losses from the previous session after OPEC+ postponed a ministerial meeting, which stoked expectations that producers might cut output less than had been anticipated.
In cryptocurrencies, Binance chief Changpeng Zhao has stepped down and pleaded guilty to violations of US anti-money laundering laws as part of a $4 billion settlement resolving a years-long investigation into the world’s largest crypto exchange.
Bitcoin fell slightly by 0.77% on Thursday to $37,337 after rising nearly 5% on Wednesday.
Key figures
Tokyo – Nikkei 225 <> CLOSED
Hong Kong – Hang Seng Index > UP 0.99% at 17,910.84 (close)
Shanghai – Composite > UP 0.60% at 3,061.86 (close)
London – FTSE 100 > UP 0.01% at 7,469.81 (0933 GMT)
New York – Dow > UP 0.53% at 35,273.03 (Wednesday close)
- Reuters with additional editing by Sean O’Meara
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