China Buoys Asia Stocks as Treasuries, Yen Weakens - Asia Market Wrap

22 Sep 2023 05:05China Energy Japan JPY US Bonds US Indexes USD

- Chinese equities rose on Thursday, defying regional falls, while the 10-year Treasury yield hit its highest level in 16 years as an indication that investors anticipate continued increases in US interest rates.

- Shares in mainland China and Hong Kong increased while those in Japan, Australia, and South Korea declined, capping a string of daily losses. In Chinese markets, tech companies were well-priced, with the Hang Seng Tech index rising as much as 2.6%.

- After the S&P 500 fell 1.6% on Thursday, the most since March, and all significant US equity indexes fell below their 100-day moving averages, US futures edged slightly higher.

- The yen declined as the Bank of Japan maintained interest rates, its target yield on the 10-year note, and its forward guidance. The central bank reaffirmed its belief that the rate of inflation is slowing. Consumer price data that came earlier beat forecasts, raising doubts about the BoJ's prediction that price pressures will peak in 2023 and then return to the 2% objective in the following years.

- The 10-year Treasury note's yield reached 4.5% on Thursday, its highest level since 2007. This increased selling pressure on US government securities. Following the most recent report on the US labour market, which supported the Federal Reserve's higher-for-longer policy, Treasury rates increased.