Chinese equities were standout underperformers in Asia Wednesday as traders weighed weak economic data and Beijing’s reluctance to commit to more stimulus. The benchmark CSI 300 Index tumbled as much as 7.4%, but regained some of its losses on a report China will hold a briefing on Saturday about fiscal policy. Chinese markets had surged Tuesday when they returned from the Golden Week holiday. US equity futures also slipped following a report that the US Justice Department was weighing a breakup of Google. Ten-year Treasury yields hovered around the key 4% mark and oil steadied after tumbling the most in more than a year. Concerns in China have mounted that the latest burst of stimulus may be insufficient to convince investors of a sustainable rally in the equity market. Chinese tourists shelled out less money during their long holiday while a news report indicated the nation needs to introduce policies to stabilize growth and expectations. That’s a further sign Beijing is attempting to build confidence among investors. The National Development and Reform Commission, China’s economic planning agency, announced that a meager 200 billion yuan ($28 billion) in spending would be advanced from next year, after analysts estimated a fiscal package worth as much as 3 trillion yuan in the pipeline. Confidence in the bull run in China is fading “just as rapidly as it had momentum not long ago,” said Hebe Chen, an analyst at IG Markets Ltd. A growing number of strategists and fund mangers have in recent days expressed skepticism about the rally, saying Beijing needs to back up its spending pledges with real money. Some are also concerned that many stocks have already reached overvalued levels. In corporate news, Alimentation Couche-Tard Inc. sent Seven & i Holdings Co. a new potential acquisition price of ¥7 trillion ($47.2 billion), showing that the Canadian company is still seeking to enter takeover talks after its initial bid was rejected. The Japanese company’s shares surged as much as 12%. Elsewhere in Asia, New Zealand’s dollar and bond yields fell after the nation’s central bank delivered a 50 basis-point cut on its benchmark rate, while the Reserve Bank of India left rates unchanged. The RBI changed its monetary policy to neutral, sending shares higher. South Korea will join FTSE Russell’s benchmark bond index, capping months of official campaigning and a overhaul of financial market infrastructure. Fed Bank of Boston President Susan Collins noted that rate cuts should be careful and data-based. Her Atlanta counterpart Raphael Bostic said while risks to inflation have come down, threats to the labor market have risen, though the economy is still strong. Governor Adriana Kugler said officials should keep the focus on bringing inflation to target, with a “balanced approach” that avoids a slowdown in jobs. US After Hours After Hours Summary: BA +0.7% ticks higher despite S&P placing it on CreditWatch Negative; ALAB +5% higher after announcing new portfolio of fabric switches for AI workloads
Nikkei +1.06% Hang Seng +0.70% CSI -3.43% Shanghai -3.62% Shenzen -4.18%
Eur$ 1.0975 CNH 7.0611 CNY 7.0611 JPY 148.53 GBP 1.3092 CHF 0.8581 RUB 96.8266 TRY 34.2713 WTI$ 74.19 +0.83% Gold 2,620 BTC 62,408 ETH 2,443
S&P -0.20% Nasdaq -0.31% EuroStoxx +0.04% FTSE +0.27% Dax +0.06% SMI -0.17%
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