Shares are recovering despite fears of inflation persisting

After TSE suspended all trading due to system issues in Tokyo, Japan on October 1, 2020, blank prices will be displayed on the Tokyo Stock Exchange (TSE) Stock Quotes. REUTERS / Issei Kato / Files

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LONDON / HONG KONG, May 17 (Reuters) – Asian stocks led to a global rally on Tuesday in hopes of easing China’s repression of technology and Kovit-19, but concerns over rising prices around the world created tension in markets as investors waited. More signals from policymakers.

European stocks continued to make a positive start in Asia, with the STOXX index of 600 major European stocks. (.STOXX) With 0.62% and US stock futures, the S&P 500 e-minis suggests that Wall Street will follow suit.

Wide index of MSCI of Asia-Pacific equities outside Japan (.MIAPJ0000PUS) The stock rose 1.5% on Tuesday, but has fallen 6.4% so far this month.

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“There has been a good session in Asia, with the S&P 500 taking the lead, the US is likely to rise by about 1% … but looking ahead, markets will remain firm on inflation and rate hikes,” said Philip Shaw, chief economist. At Investec in London.

“The headlines focus on the high inflationary pressures that arise directly from the conflict in Ukraine, or the partial supply chain deficit emerging from the locks in China,” he said.

Hopes that the latter could be eased created a positive mood in stocks early Tuesday.

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Shanghai reached the long-awaited three-day milestone without any new COVID-19 cases outside the isolated zones, which could lead to the start of deregulation. read more

Meanwhile, those familiar with the matter told Reuters that Chinese Deputy Prime Minister Liu will speak at a meeting on Tuesday with technology executives aimed at boosting the growth of the digital economy. read more

Since late 2020, the meeting has been closely watching Liu & others’ comments on clues as to how far Chinese authorities will ease a regulatory repression in the previously high-flying technology sector.

In Tokyo, Nikkei (.N225) Afternoon trading rose 0.33%, with the S&P / ASX200 in Australia (.AXJO) The index increased 0.25%.

CSI300 Index of Mainland China (.CSI 300) Hong Kong’s Hong Cheng index rose 0.95% (.HSI) Technology companies listed in the city were up 2.35% (.HSTECH) Beijing’s repression in the sector rose by more than 4% in hopes of easing.

Developmental fears

However, despite the slight recovery in stocks, there were signs of tension elsewhere as economic growth fears re-emerged in two of the world’s major economies following weak retail and industrial production figures in China and disappointing US production data. read more .

The New York Central Bank’s Empire State Manufacturing Index, released on Monday, showed a sharp decline in May and exports have plummeted since the onset of the epidemic. read more

Yields on the benchmark 10-year Treasury notes rose to 2.9203%, up from 2.879% in the previous session on Monday.

Investors will look at the number of central bank policymakers speaking on Tuesday for additional indications of the timing of rate hikes to combat inflation.

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Jerome Powell, President of the US Federal Reserve, Christine Lagarde, President of the European Central Bank, and John Canlif, Vice Governor of the Bank of England, are scheduled to speak at 1800 GMT.

Futures markets will raise 50 consecutive basis points in June and July, reaching 2.75% by the end of the year. However, there is growing expectation that other central banks will catch up.

The US dollar index, which tracks the greenback against a basket of currencies, fell 0.23% to 103.9, gaining further as investors eased the US rate hike. read more

The European single currency was up 0.3% at $ 1.046, losing 0.96% in a month.

Investors also benefited from the recent rally in oil prices, with Hungary slashing prices on Tuesday following opposition to the EU’s push for a ban on Russian oil imports, which will tighten global supplies.

US crude was down 0.36% at $ 113.79 a barrel. Brent crude was down $ 114.12.

The dollar’s recession supported the demand for greenback gold, and the price of gold remained stable as US Treasury yields came under pressure to recover. Spot gold traded up 0.1% at $ 1,825.44 an ounce.

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Additional Report by Scott Murdoch in Hong Kong; Editing Lincoln Feast, Kirsten Donovan

Our standards: Thomson Reuters Trust Principles.

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