Asia shares rebound sharply on China policy pledges
By Ankur Banerjee
SINGAPORE (Reuters) — Asian shares jumped and the yuan rose on Tuesday as investors cheered China's pledge to step up support for its sputtering economy, with the heaviest buying in Hong Kong's beaten-down property sector while the dollar dipped against key rivals.
MSCI's broadest index of Asia-Pacific shares outside Japan snapped a six-day losing streak with a 1.5% gain. Japan's Nikkei fell 0.4%.
In China, the Shanghai Composite Index rose 1.9% and the Hang Seng leapt 3% with property stocks that had been diving on debt repayment worries bouncing back. [.HK][.SS]
Country Garden jumped 14% and was the top-traded stock in Hong Kong while its onshore-traded debt recovered to slightly less distressed levels. Shares in its services arm and rival Longfor rose by more than 20%.
China's top leaders pledged on Monday to step up help for the economy amid a tortuous post-COVID recovery and signalled there would be more to come for the property industry.
«Perhaps the biggest move was the pledge to 'adjust and optimise property policies,' which opens the door for further property easing,» said Citi analysts.
«The Chinese economy could muddle through the second half amid such a policy setting.»
An index of mainland developers jumped 11% on Tuesday and was headed for its best day in eight months.
In the currency market, the Chinese yuan strengthened about 0.5% to 7.1526 per dollar, helped by state banks selling dollars onshore and offshore early in Asia. [CNY/]
The move set the tone across other pairs and the dollar index, which measures the U.S. currency against six major rivals, eased 0.1% to 101.31. [FRX/]
The China-sensitive Australian dollar rose 0.4% to $0.6767. The kiwi added 0.2% to $0.6215. [AUD/]
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