Positive signs in Asia, with ‘vehicle’ China progress against Covid

Major stock indices in the Asia-Pacific region are moving positively on Tuesday, as China’s progress in the field of the Covid pandemic overshadows the new losses recorded by the flagship of international markets, Wall Street, on Monday.

On the board, the Japanese Nikkei gained 0.42%, to 26,659.75 points, with the South Korean KOSPI to gain 0.92%, while in Hong Kong, the Hang Seng records gains of 2.92%. In mainland China, the Shanghai is increased by 0.49%, while o Shenzen increased by 0.91%. In Taiwan, the Taiwan Weighted closed with an increase of 0.98%, while in Australia, the S & P / ASX 200 recorded an increase of 0.27%.

The signs of progress in the Chinese authorities’ efforts to bring the latest outbreaks of coronavirus under control prevail over the weak macroeconomic data announced for the second largest economy in the world in April.

Investors are also watching the comments of US Federal Reserve officials, which provide important insights into both the US economy outlook and the Fed’s monetary policy in the near future.

The element that markets are trying to decipher is basically how companies and consumers respond to a higher priced environment and whether central banks can help alleviate the problem through monetary policy.

The main concern remains whether the Federal Reserve, with its cycle of aggressive interest rate hikes of 50 basis points (0.5%) in each of its subsequent sessions, could cause a recession, either because of the level at which interest rates will reach or because of the speed with which they increase.

Problems in the supply chain, the result of both the wider coronavirus pandemic and the recent lockdown in China in particular, are fueling a climate of concern, as Russia’s war against Ukraine has already led to a spike in energy prices, increasing volatility and inflationary pressures.