ASIAN EQUITY RALLIED ON SOFTER INFLATION DATA
Shares in India climbed 1,098 points or 1.8% to a near 11-month high of 61,716 in afternoon trade on Friday, reversing from losses in the prior two sessions and heading for a 1.3% gain weekly, buoyed by news that China eased some COVID zero rules by tweaking some quarantine rules. Investors were also upbeat after an upsurge on Wall Street overnight as softer-than-expected inflation data raised hopes the US Fed will slow its tightening campaign. Meantime, India will report its October inflation data next week. The Nifty Index jumped 1.7%, with the IT sub-index climbing around 4% on the back of a 7.4% jump in Nasdaq Thursday. Zomato jumped 8% after the food delivery firm saw a narrower loss for Q2. Other notable gainers were HDFC Bank (6.5%), Infosys (4%), Tata Motors (1.9%), Reliance Ind. (1%), and Bajaj Finance (0.9%). Among the companies that will report their earnings were Mahindra & Mahindra, Life Insurance Corporation of India, and engineering company Bharat Heavy Electricals.
The Nikkei 225 Index rallied 2.98% to close at 28,263 while the broader Topix Index jumped 2.12% to 1,978 on Friday, reaching their strongest levels in over eight weeks.. Investors also reacted to data showing producer prices in Japan slowed less than expected to 9.1% in October as high commodity prices and a weak yen continued to inflate input costs for companies. Moreover, investors awaited a raft of earnings reports from major firms such as SoftBank Group, Olympus and Toshiba. Technology stocks led the rally, with notable gains from Tokyo Electron (8.4%), Advantest (9.1%) and Recruit Holdings (8%). Other index heavyweights also posted strong gains, including Fast Retailing (2%), Sony Group (5.5%), Shiseido (10.9%), Daikin Industries (7.2%) and Shin-Etsu Chemical (6.6%).
The Shanghai Composite jumped 1.69% to close at 3,087 while the Shenzhen Component surged 2.12% to 11,140 on Friday, rising from recent lows after China eased some Covid rules by reducing the quarantine period for travelers and close contacts of infected people. Chinese authorities would also cease the practice of identifying close contacts of close contacts, dialing back strict contact tracing measures that earned the ire of the public. Moreover, Chinese stocks tracked a global equity rally after lower-than-expected US inflation data raised hopes that the Federal Reserve would tighten less aggressively in the coming months. Nearly all sectors advanced, with strong gains from index heavyweights such as Kweichow Moutai (3.6%), Zijin Mining (8.4%), East Money Information (5.3%), Contemporary Amperex (4.5%) and China Tourism Group (3.7%). The benchmark indexes ended the week little changed, having been whipsawed earlier in the period by mixed signals about China’s Covid policy.
Hong Kong's shares climbed 821 points or 5.1% to a 4-week high of 16,902 in morning deals on Friday, up for the first session in three and heading for around 6% surge weekly. industry data said that China's auto exports hit a record high of 337 thousand units in October, on a rapid expansion of new-energy vehicles. Traders looked past reports that China's new bank lending fell to a near 5-year low in October and total social financing was far below forecasts. The upturn in the index was broad-based, amid sharp gains from real estate stocks, consumers, industrials, and tech. Among early performers were Longfor Group (17%), Country Garden (11.5%), Techtronic Ind. (10.8%), JD.Com (9.1%), and Meituan (7.9%).
