Portfolio

Asia report: Markets rise as China regulatory fears ease

By Josh White

Date: Thursday 29 Jul 2021

Asia report: Markets rise as China regulatory fears ease

(Sharecast News) - Stock markets in Asia bounced from their losses earlier in the week on Thursday, with Hong Kong's bourse advancing more than 3%, as reports out of China around foreign listing rules helped to quell regulatory fears for the technology sector there.
In Japan, the Nikkei 225 was up 0.73% at 27,782.42, as the yen strengthened 0.06% against the dollar to last trade at JPY 109.84.

Of the major components on the benchmark index, robotics specialist Fanuc was up 2.32%, Uniqlo owner Fast Retailing added 0.91%, and technology giant SoftBank Group jumped 4.08%.

Those gains for SoftBank came after reports that the company was selling a third of its holding in car booking app giant Uber, in a bid to cover its losses on the broadly equivalent Chinese app Didi Chuxing.

Electronics firm Sony was also in the green, advancing 3.46%, after the company reported that 10 million PlayStation 5 units - its fastest-selling video gaming console in its history - had been sold since launch.

The broader Topix index was ahead 0.41% by the end of trading in Tokyo, closing at 1,927.43.

On the mainland, the Shanghai Composite added 1.49% to 3,411.71, and the smaller, technology-centric Shenzhen Composite jumped 3.07% to 2,384.17.

South Korea's Kospi managed gains of 0.18% to 3,242.65, while the Hang Seng Index in Hong Kong closed 3.3% firmer at 26,315.32.

The special administrative region's benchmark had lost more than 8% in the first two sessions of the week, amid fresh regulatory concerns out of Beijing for China's technology industry.

Those concerns were allayed somewhat overnight, after CNBC reported that Beijing's regulators had told brokerages that it would allow Chinese companies to list in the United States, subject to listing requirements.

Of the tech plays in Hong Kong on Thursday, Alibaba was up 7.7%, Meituan added 9.49%, and Tencent leapt 10.02%.

The blue-chip technology stocks were on the back foot in Seoul, with Samsung Electronics down 0.25%, and SK Hynix finishing flat.

Investors in the region also digested the latest decision from the Federal Open Market Committee in the United States overnight, with ratesetters there leaving their target interest rate range at between 0% and 0.25%.

Federal Reserve chairman Jerome Powell said after the two-day meeting that the central bank was not even close to raising interest rates at the current time.

"US markets finished the day mixed, with the Nasdaq outperforming after the latest Fed decision moved the bond tapering argument onto Jackson Hole next month," said CMC Markets chief market analyst Michael Hewson.

"Markets in Asia rebounded strongly on reports that Chinese regulators told firms that Chinese firms would be allowed to list in the US as long as they met listing requirements."

Oil prices were higher as the region went to bed, with Brent crude last up 0.31% at $74.97 per barrel, and West Texas Intermediate rising 0.54% to $72.78.

In Australia, the S&P/ASX 200 rose 0.52% to 7,417.40, while across the Tasman Sea, New Zealand's S&P/NZX 50 added 1.06% to 12,728.85.

The down under dollars were both stronger on the greenback, with the Aussie last ahead 0.38% at AUD 1.3510, and the Kiwi advancing 0.54% to NZD 1.4296.

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