Asian markets track Wall St higher as Hong Kong extends rally

HONG KONG  -  Hong Kong and Shanghai stocks ex­tended their rally Wednesday on hopes for more Chinese measures in support of battered markets, while traders elsewhere in Asia tracked Wall Street advances fuelled by strong earnings. Fresh comments from Federal Reserve officials that poured cold water on hopes for an early interest rate cut appeared to have little impact with investors re­signed to the prospect of monetary policy remaining tight well into 2024.

A series of announcements out of Beijing has lit a fire under equities in Hong Kong and Shanghai this week, with Bloomberg reporting that com­panies have spent more than $4 bil­lion on buybacks after officials called on them to play their part. The surge on Tuesday came after a unit that con­trols government stakes in big finan­cial institutions said it would ramp up investments in funds, while regulators said it would urge more action from long-term funds. The developments follow a long-running rout in Shang­hai and Hong Kong -- fuelled largely by worries over China’s economy -- that has slashed trillions off valuations. The crisis is becoming increasingly uncomfortable for the leadership, with Xi Jinping reported to be taking a personal interest. “Sentiment im­proved after (Tuesday’s) ripping rally in Chinese and Hong Kong stocks,” said Kyle Rodda of Capital.Com.

“For now, the measures have had their desired effect,” he added, point­ing out that the markets were reach­ing levels that could spell the end of their downward spiral. Shanghai and Hong Kong each jumped more than one percent Wednesday -- a day af­ter piling on more than three percent and four percent respectively. But observers warned the measures will not be enough on their own to revive confidence among weary investors, adding that much more needs to be done to kickstart the world’s number two economy and address the prop­erty sector debt crisis. And Saxo’s Redmond Wong said in a note: “In our opinion, the boost from market inter­vention tends to fade within days.” There were also gains Wednesday in Sydney, Seoul, Singapore, Wellington, Manila and Jakarta, though Tokyo edged down. The advances came af­ter Wall Street’s three main indexes chalked up small gains thanks to more healthy corporate results, in­cluding from Spotify and data analyt­ics firm Palantir, which soared more than 30 percent on optimism over its artificial intelligence offerings.

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