Asia-Pacific Stocks – China Shares Surge after PBOC Tweaks Rule, Investors Bet on Steady Recovery
Major Asia-Pacific stock indices were mixed but mostly higher early Monday, with investors watching negotiations on US stimulus and Chinese yuan movements.
The big gain was in the China Shanghai Index, followed by the Hong Kong Hang Seng Index. While stocks struggled in Australia they stayed positive, but in Japan the Nikkei 225 bucked the trend and moved lower.
On the spot market at 03:47 GMT, the Japanese Nikkei 225 index is trading at 23543.95, down 75.74 or -0.32%. The Hang Seng Index in Hong Kong is at 24529.51, up 410.38 or + 1.70%, and the Hang Seng Index in Hong Kong is at 2402.66, up 10.70 or + 0.45% .
In China, the Shanghai Index is trading at 3346.26, up 74.19 or + 2.27%, and in Australia, the S & P / ASX 200 Index is trading at 6112.70, up 10.50 or + 0 , 17%.
China pushes Asian stocks to two-year high
Chinese stocks spiked Asian markets on Monday as investors looked to the world's second-largest economy to rebound, despite caution over the fate of the US economy holding the dollar in place and optimizing central bank policy undoing some of the yuan's gains .
China has returned from an eight-day mid-autumn festival, where investors were encouraged by a strong rebound in tourism and declining coronavirus cases.
People's Bank of China announces rule change
Investors will monitor the yuan's movement on Monday after the People's Bank of China announced a rule change that made it cheaper to sell the yuan.
The central bank announced on Saturday that as of Monday, financial institutions will no longer need to set aside cash to conduct currency forwards. Previously, according to Reuters, financial institutions had to set aside 20% of the previous month's yuan forward settlement amount as foreign exchange risk reserves.
South Korea's stocks gain US economic hopes on day eight
South Korean stocks rose for the eighth straight Monday as US economic hopes lifted investor sentiment. The won reached a high for more than a year, while the benchmark bond yield also increased.
The Trump administration on Sunday called on Congress to pass a scaled-down coronavirus relief law as negotiations on a more comprehensive package met resistance.
"KOSPI opened up and followed earnings in the US market in hopes of additional impetus ... although investors will keep an eye on US corporate earnings and political uncertainties," said Seo-Sang-young, an analyst at Kiwoom Securities .
Australian stocks soar as investors wait for earnings and production results
Australian stocks rose sharply on Monday as investors failed to make huge bets on corporate earnings and manufacturing results while awaiting further developments in US economic talks.
A number of Australian companies, including global miners BHP Group and Rio Tinto, are expected to release their quarterly production figures later this week, while the big four banks will give an initial glimpse of how lenders did for the July-September quarter this month.
In our economic calendar you will find all economic events of today.
This article was originally published on FX Empire
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