Sat. Jan 22nd, 2022

Chinese tech stocks rose Monday after starting the year with a week of sharp declines, but markets across the Asia-Pacific region were mixed as investors weighed in on the possibility of a US Federal Reserve rate hike.

Hong Kong’s Hang Seng Tech index rose as much as 2.5 percent on Monday, with Alibaba Health Information Technology rising as much as 14 percent and short video platform Kuaishou’s Hong Kong-listed stocks up 12.2 percent.

The Star 50 index of Shanghai-listed technology stocks climbed about 1 percent.

The upswing followed a weak start to 2022 that underperformed Chinese technology stocks compared to their global counterparts, who were themselves hit last week by growing expectations of a rate hike by the U.S. Federal Reserve.

Even after Monday’s gains, Shanghai’s Star 50 remained nearly 6 percent lower this year, while the Nasdaq Composite lost 4.5 percent.

The early stumble by Chinese equities forced regulators to promise supportive measures in an effort to calm the shivers in the market. Yi Huiman, chairman of China’s security regulator, promised late last week to “take multiple measures to ensure smooth market operations and resolutely prevent large and sudden ups and downs”.

Dickie Wong, head of research at Kingston Securities in Hong Kong, said global institutional investors and Chinese traders in the mainland jumped into stocks such as Tencent and Alibaba on Monday.

“Over the past few months, Chinese technology stocks have lagged behind. It was already time for bargain hunters to shop, ”said Wong.

“It’s time for [Chinese] technology to recover, at least for those at the top of the market. ”

Markets elsewhere in the region were mixed, with South Korea’s tech-heavy Kospi down nearly 1 per cent and Australia’s S & P / ASX 200 benchmark down 0.1 per cent as market participants looked ahead to the US inflation figures payable on Wednesday.

Last week, global traders sold technology stocks pending rate hikes by the Federal Reserve, which indicated it might rates increase “sooner or at a faster pace” than officials initially expected.

Some economists moved their predictions up for rate hikes even after U.S. data released Friday released a slowdown in the number of new jobs last month as the Fed’s shift shifted from supporting the labor market to tame rising inflation.

Unsecured – Markets, finance and strong opinion

Robert Armstrong dissects the major market trends and discusses how Wall Street’s best minds react to them. Sign in here to have the newsletter sent straight to your inbox every weekday

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