Asian stocks rose on Tuesday, with Chinese markets posting the biggest gains after the central bank series of measures to support the economy.
Shares in Hong Kong rose 2%. U.S. futures fell slightly, while oil prices rose.
Among several policy measures aimed at stemming a prolonged downturn in the real estate sector, People’s Bank of China Governor Pan Gongsheng said reserve requirements for banks would be cut by 0.5 percentage points and that the central bank would follow up with further cuts, freeing up more money for lending.
Regulators are also planning new policies to support stable development of the stock market, Pan and other senior officials told reporters in Beijing.
The coordinated measures, rather than “a trickle-down, piecemeal support”, are “a step in the right direction”, said Julian Evans-Pritchard of Capital Economics in a commentary.
“But it is unlikely to be enough to bring about a turnaround in growth unless more fiscal support is provided,” he said.
Hong Kong’s Hang Seng rose more than 400 points to 18,604.26, while the Shanghai Composite index rose 0.9% to 2,772.58.
In Tokyo, the Nikkei 225 index rose 0.7% to 37,974.98, while the Kospi in Seoul was virtually unchanged at 2,602.30.
Australia’s S&P/ASX 200 fell 0.3% to 8,126.30.
Monday is the S&P 500 rose 0.3% to 5,718.57, marking its record set on ThursdayThe Dow Jones Industrial Average rose 0.1% reached its own record high on Friday and closed at 42,124.65. The Nasdaq Composite rose 0.1% to 17,974.27.
Tesla led the way with a 4.9% gain, recovering all the sharp losses from earlier this year. It had fallen 42% at one point in April as it cut prices on its cars to lukewarm sales.
That helped offset a 10.3% decline for Trump Media & Technology Group, which fell to its lowest price since taking over the Nasdaq stock exchange in marchThe company behind former President Donald Trump’s Truth Social network has down for six days in a row amid speculation about when Trump and other company insiders sell their shares now that they are no longer bound by a “lock-up” agreement. Trump has said he has no intention of selling.
A report Monday morning suggested that U.S. business activity is not growing as quickly as economists had expected, largely because of a continued downturn in manufacturing. The preliminary report from S&P Global said U.S. manufacturing contracted more sharply in September than in August, hitting a 15-month low. It is one of the parts of the economy most affected by high interest rates.
Several economic reports due later in the week could provide more context on where the U.S. economy stands. One on Thursday will provide the final update on U.S. economic growth in the spring, and another on Friday will take a look at how much American consumers are spending.
Such reports, particularly on employment, are becoming a top priority on Wall Street because the biggest fear now is a slowdown in the labor market. It’s a notable shift from previous years, when Wall Street’s attention was focused on all things inflationary.
But now that inflation has fallen substantial of the highlight two summers agothe Fed has changed course.
It feels less need to keep rates high to slow the economy enough to suppress inflation, hence the half-percentage point cut in the key rate last week. And it feels more pressure to support the labor market and the broader economy, hence the plans to keep cutting rates this year and next.
In the bond market, the yield on the 10-year Treasury note held steady at 3.74%, where it was Friday night. The yield on the 2-year Treasury note, which moves more with expectations of Fed action, fell slightly to 3.58% from 3.60% Friday night.
In other trading early Tuesday, benchmark U.S. crude rose 44 cents to $70.81 a barrel. Brent crude, the international standard, rose 41 cents to $73.62 a barrel.
The US dollar rose to 143.65 Japanese yen from 143.61 yen. The euro fell to 1.1106 dollars from 1.1113.
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AP Business journalist Stan Choe contributed.
