HONG KONG — Stocks in Asia surged on Friday, with Hong Kong and other Chinese markets leading the way, as China implements measures to stimulate its economy.
Japan’s Nikkei 225 index climbed over 1% as the ruling Liberal Democratic Party held a leadership election, paving the way for Japan’s next prime minister. Analysts expect little change in policies, given the similarities among the primary candidates.
China’s central bank has lowered the reserve requirement ratio for banks, reflecting efforts to bolster the property sector and stabilize financial markets.
The Hang Seng index in Hong Kong jumped 3.7% to 20,659.03, while the Shanghai Composite index surged 2.1% to 3,065.29.
In an unexpected development, the Shanghai Stock Exchange experienced processing glitches, causing delays in order processing after the market opened. This prompted a 6.4% rise in the Shenzhen index, as investors shifted their focus to that market during the technical issues.
Trading returned to normal by midday, and the Shanghai Stock Exchange is actively investigating the glitches.
In a troubling indicator of the economic challenges facing the world’s second-largest economy, recent reports revealed a nearly 18% year-on-year decline in industrial profits for August.
Amid these developments, shares of Hong Kong’s New World Development surged 21.5% following the announcement of a leadership change at the firm. The company faced an unprecedented annual loss exceeding $2.4 billion last month.
In Japan, the Nikkei 225 closed 1.4% higher at 39,451.25, spurred by Tokyo’s consumer inflation rates cooling to 2.2% year-on-year in September, aligning with market expectations.
Stocks in other regions also saw movement, with Australia’s S&P/ASX 200 inching up by nearly 0.1% to 8,208.70, while South Korea’s Kospi dipped 0.2% to 2,666.01.
In the U.S., the S&P 500 marked a 0.4% increase to reach 5,745.37, setting its third all-time high for the week and the 42nd in 2023. The Dow Jones Industrial Average rose 0.6% to 42,175.11, while the Nasdaq composite also gained 0.6% to 18,190.29.
Micron Technology saw a significant rise of 14.7%, spurred by stronger-than-expected quarterly profits, largely attributed to its sales growth in the artificial intelligence sector. Additionally, Jabil experienced an 11.7% increase in stock price after reporting better-than-anticipated profits and announcing a $1 billion stock buyback plan.
In contrast, Super Micro Computer faced a decline of 12.2%, retracting from its substantial gains amid reports of a U.S. Department of Justice probe into the company.
Recent reports suggest that the U.S. economy might be outperforming expectations, as indicated by a drop in unemployment applications and a steady economic growth rate of 3% in the spring.
Market optimism continues to grow as Wall Street anticipates sustained economic growth that supports corporate profits while the Federal Reserve lowers interest rates. The Fed recently shifted its approach by cutting rates to stimulate economic activity after maintaining high rates for years to combat inflation.
In commodity markets, U.S. benchmark crude oil dipped 15 cents to $67.52 per barrel, while Brent crude lost 19 cents to settle at $70.90 per barrel.
The U.S. dollar strengthened against the Japanese yen, trading at 145.24, while the euro stood at $1.1170, down from the previous day.
