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

China Just Saved Asia Stocks From Entering Bear-Market Territory

Published 2018-10-24, 12:47 a/m
Updated 2018-10-24, 01:22 a/m
© Bloomberg. A bear statue stands outside the Frankfurt Stock Exchange in Frankfurt, Germany, on Monday, March 14, 2016.

© Bloomberg. A bear statue stands outside the Frankfurt Stock Exchange in Frankfurt, Germany, on Monday, March 14, 2016.

(Bloomberg) -- It’s been a day of swings between losses and gains for Asian stocks. But now that China and Hong Kong are back with a vengeance, the regional benchmark is inching higher in the green.

Asia’s main equity gauge, which was poised to succumb to bear market territory earlier, is now up 0.3 percent as of 12:45 p.m. in Singapore as the indexes for China and Hong Kong rallied by the mid-day trading break. Even U.S. stock-index futures have flipped into a slightly higher region.

It’s worth noting that Chinese stocks might be in a bit of a “one step forward, two steps back” mode as the market holds on to its title of world’s wildest market. While there have been some days of solid rallies over the past couple of months, the Shanghai Composite Index is still down about 20 percent since the end of December. The only caveat is that China’s national team might just be waking up to heavier support for the rest of the year.

First a recap on what happened overnight:

  • Expectations for a one-on-one meeting between President Donald Trump and China’s Xi Jinping are already being lowered, with officials from both sides increasingly pessimistic about prospects for a resolution to their deepening trade war.
  • Trump criticized the conflicting accounts from Saudi Arabia and said he’s passing responsibility to Congress for responding to the killing of Jamal Khashoggi.
  • Fed’s Raphael Bostic said he supports further gradual interest-rate hikes and warned of running the economy hot.
  • Trump stepped up his attacks on Fed’s Powell and said he “maybe” regrets appointing him to the post, the Wall Street Journal reported citing an interview with the president.
  • The rolling bear market in U.S. equities is getting hard to shake off after Caterpillar Inc (NYSE:CAT). slumped as it held to its earlier 2018 outlook that disappointed analysts.
  • Some strategists are suggesting investors hold on to cash.
  • Tech stocks in Asia were literally flat as shares of chip companies fell after Texas Instruments (NASDAQ:TXN) Inc. gave disappointing guidance.

Where to from here? Earnings season will be key. All eyes will be on U.S. tech stocks this week as companies including Amazon.com Inc (NASDAQ:AMZN)., Google’s Alphabet (NASDAQ:GOOGL) Inc., Twitter Inc (NYSE:TWTR). and Microsoft Corp (NASDAQ:MSFT). are scheduled to report this week.

Everywhere else in Asia, stock markets are seeing modest gains. In India, the S&P BSE Sensex climbed, propelled by the steepest oil drop in three months. Japan’s Topix index fluctuated as explorers of crude slid and electronics stocks rose. Japan investors may be waiting for earnings to kick into full gear -- the ratio of short bets on shares traded on the Tokyo Stock Exchange climbed to a record of 50.8 percent as the Topix closed on Tuesday at its lowest level since September 2017.

Here are some other notable moves today:

  • Nexon Shares Slide After China Said to Halt Special Approval
  • Asia Chip Stocks Decline After Texas Instruments Warns on Demand
  • Super Retail Falls Most in 8 Months Amid Slowdown in Auto Sales

Stock-Market Summary

  • Japan’s Topix index up 0.2%; Nikkei 225 up 0.5%
  • Hong Kong’s Hang Seng Index up 0.9%; Hang Seng China Enterprises up 1.1%; Shanghai Composite up 1.5%
  • Taiwan’s Taiex index up 0.2%
  • South Korea’s Kospi index little changed; Kospi 200 little changed
  • Australia’s S&P/ASX 200 down 0.3%; New Zealand’s S&P/NZX 50 down 0.4%
  • India’s S&P BSE Sensex Index up 0.7%; NSE Nifty 50 up 0.7%
  • Singapore’s Straits Times Index up 0.6%; Malaysia’s KLCI up 0.2%; Philippine Stock Exchange down 0.4%; Jakarta Composite little changed; Thailand’s SET down 0.9%; Vietnam’s VN Index down 0.6%

© Bloomberg. A bear statue stands outside the Frankfurt Stock Exchange in Frankfurt, Germany, on Monday, March 14, 2016.

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.