Asia close: Stocks buoyed by record highs on Wall Street, Chinese names dragged lower by talk of property taxes

by | Oct 26, 2021

It was a mostly risk-on session for Asia Pacific stocks on Tuesday, with investor sentiment buoyed by fresh record highs overnight for the Dow Jones Industrials and S&P 500.
There was also some “market chatter” to be heard regarding US-China trade and the increasing potential for tariffs to be lowered.

The result of virtual talks between US Treasury Secretary Janet Yellen and Chinese Vice Premier Liu He augur well for the phase-one deal review by year-end with higher odds of a decrease in tariffs, Mizuho Bank said, according to Dow Jones Newswires.

Against that backdrop, Japan’s Nikkei 225 shot ahead by 1.77%, led by shipping and steel names, to 29,106.01 with the South Korea’s Kospi climbing 0.94% to 3,049.08 alongside.

Gains in Seoul were noteworthy after the quarter-on-quarter rate of growth in the country’s gross domestic product was reported at up 0.3% (consensus: 0.6%).

Nevertheless, Capital Economics said Bank of Korea remained on course to hike rates by 25 basis points in November, followed by another three hikes over the course of 2022.

Taiwan’s Taiex meanwhile notched up a gain of 0.83% to 17,034.34.

Chinese and Honk Kong issues however skipped out on gains, falling for a second day after Beijing said at the weekend that it would conduct property-tax trials in parts of the country, some market commentary observed.

Also dampening the mood in China was news from the day before that Modern Land had become the fourth Chinese property developer to default on an overseas debt obligation, said Jeffrey Halley, senior market analyst Asia Pacific at Oanda.

“As a final note, readers should keep an eye on the Covid-19 situation there which is rapidly evolving. The arrival of delta in Covid-zero countries in other parts of the world suggests challenges ahead, even for China,” Halley added.

“If it spreads rapidly, some severe lockdowns could follow. That would complicate an already nightmarish scenario for global supply chains under stress from China’s energy consumption cuts and the other usual suspects.”

The Shanghai Stock Exchange’s composite index drifted lower by 0.34% to 3,597.64 with shares of China Vanke retreating 4.3% and those of Poly Developments down 3.3%.

It was a similar story in Hong Kong with the Hang Seng 0.36% lower to 26,038.27.

Dragging on the Hang Seng were tech and property names; shares of Alibaba Health Information Technology paced losses among the former after the company told shareholders to expect a record first half loss.

Among land developers, China Resources fell 6.7%, while Country Garden Holdings gave up 4.3% and China Overseas Land & Investment lost 3.4%.

Stocks in Australia and New Zealand were little changed with profit-taking cited by some observers as part of the reason.

In currency markets, dollar/yen was holding near its recent highs, up 0.25% on the day at 114.0 while against the yuan, the greenback was edging down 0.07% to 6.38.

Related articles

Asia report: Markets in the red as Apple suppliers tumble

Asia report: Markets in the red as Apple suppliers tumble

(Sharecast News) - Asia-Pacific markets experienced a mixed performance on Wednesday, marked by declines among technology stocks in particular. South Korea and Taiwan saw significant drops, as pressure was piled on major tech firms, particularly chipmakers, after...

Asia report: Markets mixed on final trading day of the year

Asia report: Markets mixed on final trading day of the year

(Sharecast News) - Asia-Pacific markets displayed a mixed performance on the final trading day of 2023, as investors assessed various factors impacting regional economies. Markets in mainland China were in the green, as the country's tech sector displayed particular...

Trending stories

Join our mailing list

Subscribe to our mailing list to receive regular updates!

x