Asian Markets Follow Wall St.'s Lead as Tech Boosts Hong Kong
Asian markets surged on Tuesday, buoyed by gains seen on Wall Street due to U.S. economic indicators that alleviated concerns about an impending downturn. In Hong Kong, Chinese technology companies played a key role in driving the market’s upward momentum once again.
Traders began the week on an optimistic note following Beijing's announcement over the weekend of various initiatives designed to stimulate activity among China's vast consumer base.
The following Monday brought data indicating that a crucial indicator of U.S. retail sales exceeded expectations in February, implying that the recently expressed worries regarding a potential economic slowdown in the world’s leading economy might have been exaggerated.
Nevertheless, despite the lack of fresh updates recently, investors remain concerned about how Donald Trump's trade conflict could affect worldwide economic expansion.
Hong Kong, which has risen by over 20% since the start of the year, topped the gainers list on Tuesday due to additional purchases of Chinese technology companies.
Once again, Alibaba, Tencent, and JD.com led the way, but electric vehicle manufacturer BYD also emerged as a significant victor. Its shares surged over six percent, reaching an all-time peak following the announcement of new battery tech capable of charging in just five minutes.
Alongside Tokyo, Sydney, Seoul, Singapore, Taipei, and Manila, Shanghai experienced significant growth as well.
Following two consecutive days of increases on Wall Street, which had faced significant losses this month due to selling pressure triggered by Trump’s tariff initiatives, concerns have grown about potential escalation in U.S. inflation and negative impacts on economic conditions.
Nevertheless, SPI Asset Management’s Stephen Innes cautioned investors against becoming complacent, as new tariffs on US trading partners were set to take effect as early as April 1st.
He penned in his analysis, 'Don’t settle in just yet — jittery observers continue to watch Washington’s turmoil over tariffs.'
The storm isn't over yet, and with further escalation on the horizon, the market continues to tread a delicate path between hopefulness and facing another harsh dose of reality.
Doubts regarding the effect of the tariffs contributed to gold acting as a safe haven, reaching a new high of $3,008.53 during early trading on Tuesday.
This week is expected to feature policy decisions from the Federal Reserve, Bank of Japan, and Bank of England, with all three likely to keep their interest rates unchanged.
The statement from the U.S. central bank will include revisions to their economic forecast and interest rate predictions for the year, taking into account factors such as Trump's trade policies, tax cuts, changes in immigration rules, and adjustments to federal employment roles.
Ryan Wang, an economist at HSBC specializing in the U.S., stated, "We anticipate minimal alterations in the forward guidance concerning policy rates within the revised (policy board) announcement."
"The statement could repeat that risks to (its) employment and inflation goals 'are roughly in balance' and that the 'economic outlook is uncertain'."
Nevertheless, he mentioned that although he observed no significant alterations to the bank's central economic forecast, "the adjustments we anticipate will be in a more negative direction."
Key individuals at approximately 0230 GMT
Tokyo - Nikkei 225: Increased by 1.5 percent to reach 37,943.23
Hong Kong - Hang Seng Index: RISE 1.9 percent to 24,599.48
Shanghai - Aggregate: Increased by 0.2% to reach 3,432.30
Euro/dollar: DECREASED to $1.0911 from $1.0925 on Monday
Pound/dollar: DECLINED to $1.2977 from $1.2990
Dollar/Yen: Increased to 149.51 yen from 149.12 yen
Euro/pound: Increased to 84.08 pence from 84.07 pence
West Texas Intermediate: Increased by 0.3% to reach $67.75 per barrel.
Brent North Sea Crude: Increased by 0.3% to $71.25 per barrel
New York - Dow: Increased by 0.9 percent to close at 41,841.63.
London - FTSE 100: Increased by 0.6 percent to close at 8,680.29.