Asia shares gain despite rise in Chinese COVID cases

Asia shares gain despite rise in Chinese COVID cases

SYDNEY, Nov 23 (Reuters) – Asian stock markets were mostly in positive territory on Wednesday despite rising COVID-19 cases in mainland China, leaving investors uncertain about how much new outbreaks could slow the reopening of the world’s second largest economy.

MSCI’s broadest index of Asia-Pacific stocks outside Japan (.MIAPJ0000PUS) rose 0.3%, after US stocks ended the previous session with gains. The index is up 12% so far this month.

Australian stocks (.AXJO) rose 0.7%, with most of the gains coming from mining and resources giants on higher oil prices. The Japanese stock market (.N225) was closed for a public holiday.

New Zealand’s central bank on Wednesday raised interest rates by 75 basis points – its biggest ever move – to a nearly 14-year high of 4.25% and signaled that further hikes are in sight. underway as it struggles to contain stubbornly high inflation.

Hong Kong’s Hang Seng Index (.HSI) rose 0.6% in early trading, while China’s CSI300 Index (.CSI300) opened broadly flat.

China reported 29,157 new COVID infections for Nov. 22 on Wednesday, according to the National Health Commission, up from 28,127 new cases a day earlier. The number of cases in Beijing and Shanghai is rising steadily, prompting authorities to close some facilities.

“The biggest story for investors in Asia remains the reopening of China,” said Suresh Tantia, senior investment strategist at Credit Suisse in Singapore.

“We had seen Chinese markets climb up to 20%, but those expectations are lowered, we believe a reopening will be a slower process and not rushed. This means many investors are reducing their exposure, reduce their losses or accounting for the profits they could have made on China.”

Meanwhile, the release of the US Federal Reserve’s minutes from its November policy meeting later Wednesday is eagerly awaited by investors as they seek insight into how officials view economic conditions.

The Dow Jones Industrial Average (.DJI) rose 1.2% to 34,098.1 on Tuesday, the S&P 500 (.SPX) gained 1.4% to 4,003.58 and the Nasdaq Composite (.IXIC) rose added 1.4% to 11,174.41. Energy stocks led the gains, fueled by rising oil prices.

The yield on the benchmark 10-year Treasuries rose to 3.7578% from its U.S. close of 3.758% on Tuesday.

The two-year yield, which rises on traders’ expectations of a hike in the fed funds rate, touched 4.5227% from a US close of 4.517%.

The dollar lost 0.02% against the yen at 141.21.

Europe’s single currency rose 0.02% on the day to $1.0302, while the dollar index, which tracks the greenback against a basket of currencies from other major trading partners, was down. at 107.14.

“The US dollar has lost some of its recent gains (as) central bankers’ consensus on the magnitude of interest rate hikes unravels,” wrote Commonwealth Bank analyst Tobin Gorey.

“Smaller or fewer rate hikes may not be cause for optimism, it’s cause for less pessimism.”

Oil remained higher on Wednesday after major exporter Saudi Arabia said OPEC+ would maintain production cuts and may take further steps to balance the market.

In Asian trading, U.S. crude rose 0.3% to $81.15 a barrel. Brent crude hit $88.35 a barrel.

Gold was slightly lower. Spot gold was trading at $1740.09 an ounce.

As the collapse of the FTX exchange continues to rock the cryptocurrency markets, Bitcoin was 0.33% higher during Asian trading hours at $16,184.

Reporting by Scott Murdoch in Sydney; Editing by Kenneth Maxwell

Our standards: The Thomson Reuters Trust Principles.

scott murdoch

Thomson Reuters

Scott Murdoch has been a journalist for over two decades and works for Thomson Reuters and News Corp in Australia. He has specialized in financial journalism for most of his career and covers equity and debt markets across Asia from Hong Kong.

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