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(Bloomberg) — Chinese stocks rose as policymakers took further steps to restore investor confidence and amid broader weakness in Asia following a tech-led Wall Street retreat.
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An index of Chinese companies listed in Hong Kong rose as much as 4% before the rally, while the CSI300 index of mainland stocks rose 1.4%. Property developers led the gains as banks stepped up funding for the troubled sector. A new crackdown on trading by quantitative funds also eased concerns about short selling.
This is in contrast to losses in other Asian markets and U.S. stock contracts showing declines after the Nasdaq 100 fell nearly 1% on Tuesday and the S&P 500 fell below 5,000. . The focus will be on semiconductor maker Nvidia’s financial results and the minutes of the Federal Reserve’s latest policy meeting, which will be released later on Wednesday.
Euro Stoxx futures rose slightly at the close, while US equivalents fell slightly.
“The AI hype is deflating a bit, and there could be some rotation within North Asia towards China, which has seen relatively positive consumer spending data post-holiday,” said Marvin Chen, an analyst at Bloomberg Intelligence. “While the rejoicing continues, market stabilization measures are still in place.” .
Elsewhere, HSBC Holdings shares fell as much as 4.2% in Hong Kong after the company announced an 80% drop in fourth-quarter profit. Aluminum soars on speculation that a new wave of U.S. sanctions against Russia could target the metal, disrupting supplies.
The dollar was steady in Asian trading, with 10-year Treasury yields little changed.
In Japan, the Nikkei stock average has lost momentum recently, moving further away from its 1989 closing all-time high of $38,915.87. Still, macro and equity hedge funds are betting on Japan this year, expecting the central bank to change policy in eight days. Negative interest rates will continue for years. As exports increased more than expected in January, the yen remained at around 150 yen to the dollar.
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Earnings dates for the “Magnificent Seven” mega-cap stocks vary, but the ongoing earnings season reaffirms the view that Corporate America is doing well so far. Among other highlights in U.S. trading, Walmart rose after reporting strong earnings, while Palo Alto Networks fell in late trading after lowering its full-year revenue forecast.
Faced with Nvidia’s numbers, some traders decided to lock in their profits. The market is also weighing reports that Microsoft Corp. is developing network cards as an alternative to cards supplied by chipmakers.
The artificial intelligence craze is driving stocks related to the technology higher, and Nvidia is one of the few companies to demonstrate significant revenue growth from AI.
Minutes from the Fed’s January meeting are also expected to be released on Wednesday, giving traders further clues as to where policymakers stand on the rate cut schedule. Last week’s higher-than-expected inflation rate raised concerns that the Fed would not start cutting interest rates as quickly or as quickly as market participants expected later this year.
Both crude oil and gold rose slightly.
This week’s main events:
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Eurozone consumer confidence Wednesday
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Nvidia earnings Wednesday
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The US Federal Reserve releases minutes of its January meeting on Wednesday.
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Atlanta Fed President Rafael Bostic speaks Wednesday
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Eurozone S&P Global Services PMI, S&P Global Manufacturing PMI, CPI, Thursday
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U.S. new unemployment insurance claims, U.S. existing home sales, Thursday
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ECB releases January Governing Council report on Thursday
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Fed President Lisa Cook and Minneapolis Fed President Neel Kashkari meet on Thursday
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Chinese real estate prices Friday
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Germany IFO Business Environment, GDP, Friday
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ECB releases one-year and three-year inflation expectations survey on Friday
The main movements in the market are:
stock
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S&P 500 futures were little changed as of 6:21 a.m. London time.
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S&P/Australian Stock Exchange 200 futures little changed
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Hong Kong’s Hang Seng rose 2%
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The Shanghai Composite rose 1.5%.
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Euro Stoxx50 futures little changed
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Nasdaq 100 futures fell 0.2%
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Australia’s S&P/ASX 200 falls 0.7%
currency
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Bloomberg Dollar Spot Index little changed
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The euro was almost unchanged at $1.0812.
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The Japanese yen remained almost unchanged at 149.99 yen to the dollar.
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The offshore yuan rose 0.2% to 7.1899 yuan to the dollar.
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The Australian dollar rose 0.2% to $0.6565.
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The British pound was almost unchanged at $1.2631.
cryptocurrency
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Bitcoin fell 0.3% to $51,856.99.
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Ether fell 0.5% to $2,973.86.
bond
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The 10-year government bond yield was almost unchanged at 4.27%.
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Japan’s 10-year bond yield remains unchanged at 0.725%
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The Australian 10-year bond yield fell one basis point to 4.17%.
merchandise
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West Texas Intermediate crude rose 0.1% to $77.14 per barrel.
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Spot gold rose 0.3% to $2,030.17 an ounce.
This article was produced in partnership with Bloomberg Automation.
–With assistance from Rob Verdonck.
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