Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Asian Stocks Up, Easing Lockdowns In China Offer Hopes

Published 05/31/2022, 10:06 PM
Updated 05/31/2022, 10:33 PM
© Reuters.

© Reuters.

By Gina Lee

Investing.com – Asia-Pacific stocks were up on Wednesday morning as easing lockdowns in China offer some hope for the economic outlook.

China’s Shanghai Composite inched up 0.03% by 10:32 PM ET (2:32 AM GMT) while the Shenzhen Component inched up 0.08%. Shanghai eased its lockdown on June 1, raising hopes that economic activity will pick up.

The Caixin manufacturing purchasing index released earlier in the day recorded 48.1 in May. The data is still better than the 48 in forecasts prepared by Investing.com, and above the 46 recorded in April 2022.

Asia technology stocks may also find some support as Chinese stocks listed in the U.S. recorded their first monthly gain since October.

Japan’s Nikkei 225 gained 0.66%, and In Australia, the ASX 200 edged up 0.13%.

Hong Kong’s Hang Seng Index edged down 0.18%.

The South Korean market is closed for a holiday.

Investors continued to assess how aggressive monetary tightening will be to calm inflation.

Treasuries extended a decline, pushing 10-year yields toward 2.86% as investors raised bets on U.S. Federal Reserve interest rate hikes. Swaps show that investors have almost fully priced in two half-point interest rate hikes in June and July.

With inflation squeezing consumers, investors are also concerned the aggressive tightening from the Fed might cause a recession. Euro zone consumer prices jumped 8.1% year on year in May.

“It’s times like these when investors need a crystal ball,” LPL Financial strategists Jeff Buchbinder and Ryan Detrick said in a note.

“We fully acknowledge how tough it is to see the bull case for stocks right now, and a retest of recent lows is certainly possible, but this week we lay out the bull case for the second half of the year. It starts with inflation.”

“There are heightened concerns around inflation and where central banks are likely to go trying to combat inflation,” Invesco Advisers chief global markets strategist Kristina Hooper told Bloomberg.

“This has gone from just an inflation scare to a growth scare. Uncertainty has grown,” Hooper added.

U.S. President Joe Biden met with Fed Chairman Jerome Powell on Tuesday with inflation at its 40-year high. Biden stressed that he respects the central bank’s independence but also affirmed a “laser focus on addressing inflation” ahead of the November midterms.

The Fed is set to start shrinking its $8.9 trillion balance sheet and release its Beige Book, later in the day. New York Fed President John Williams and St. Louis Fed President James Bullard will speak at separate events later in the day.

In Asia-Pacific, Australia's GDP grew 0.8% quarter-on-quarter and 3.3% year-on-year in the first quarter of 2022, according to data released earlier in the day.

On the data front, the U.S. jobs report, including non-farm payrolls, is also due on Friday.

 

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.