Asian Stocks Rise as China Pushes Insurers to Buy: Markets Wrap
(Bloomberg) — Stocks in Asia moved higher after a morning briefing by Chinese officials showed the government remains determined to boost share prices.
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China’s benchmark CSI 300 Index rose as much as 1.8%, hitting its highest level in almost three weeks before pairing some of its gains, while Hong Kong shares also jumped. The MSCI Asia Pacific index was slightly higher.
The gains came after a briefing hosted by China’s securities regulator, which said insurers and mutual funds in the country should increase their investments in the stock market. The move helped improve the mood among Chinese investors, after a tariff threat from US President Donald Trump earlier this week weighed on sentiment.
“This is like stacking the firewood to build a campfire: We are setting up for a more constructive environment, but you need a spark,” said Tai Hui, JPMorgan Asset Management’s APAC chief market strategist. “A lot of investors internationally are concerned that further deterioration in the US-China relationship could impact investment.”
The briefing was held by China Securities Regulatory Commission Chairman Wu Qing, Deputy Finance Minister Liao Min and central bank official Zou Lan, a sign that boosting China’s stock market is seen by Beijing as a government-wide effort rather than simply a problem for the securities regulator.
Still, although the move is giving the market a short-term boost, any lasting impact will depend on a recovery in China’s economy, according to market watchers.
“This is incrementally positive for the A-share market but not a game changer,” said Gary Tan, a portfolio manager at Allspring Global Investments. “We have been selectively adding to China from a bottom-up basis when valuations make sense instead of look for an event catalyst as it will take time for China to address the fundamental issues in their economy.”
Yields on 10 year Treasuries were little changed at around 4.60%. The dollar was higher against most currencies in Asia.
Digesting Trump Moves
Investors in Asia are still digesting the impact of Trump’s first few days in office, which have sent mixed signals to investors. Trump has reiterated a tariff threat against China but has largely spared the world’s second-largest economy from a feared escalation of the trade war.
The S&P 500 came close to an all-time high on Wednesday, after a three-day rally that has been fueled in part by Trump’s moves to boost spending on artificial intelligence. Earlier this week, the president unveiled a joint venture with SoftBank Group Corp., OpenAI, and Oracle Corp. that could spend billions of AI infrastructure.
SoftBank’s shares rallied in the wake of the news, and continued to move higher on Thursday. They are now up around 17% since the start of the year.
But other Asian tech stocks didn’t fare as well. Shares of Korean chipmaker SK Hynix Inc. fell as much as 4.7% after its record quarterly profit and modest capex plans failed to impress investors.
South Korea’s economy continued to sputter in the last quarter, with gross domestic product growth missing estimates. The nation plans to issue up to 20 trillion won ($13.9 billion) in special bonds from Thursday, dusting off a tool last used 21 years ago to help stabilize its currency.
The Bank of Japan is on track to raise interest rates to the highest level since 2008 on Friday, as the central bank makes steady progress toward normalization just as the Federal Reserve and the European Central Bank start to mull a pause in their easing cycles.
Oil edged lower after an industry report pointed to the first gain in US crude stockpiles since mid-November, as the market watched for further pledges on global trade from President Trump. Gold held near the highest level since October.
