- Shares in Asia surged after Wall Street advances put the S&P 500 near a record high, as investors wagered that the Federal Reserve may decrease interest rates as soon as March.
- The MSCI Asia Pacific Index rose as much as 1.1%, aiming for its highest close in more than four months.
- After returning from the holiday break, Hong Kong stocks gained, led by Chinese IT businesses, after Beijing modified its stance on the gaming industry following a market selloff prompted by proposed curbs. Mainland China shares recovered from previous losses when data showed the country's industrial earnings growing at a faster pace, aided by favourable base effects.
- After the S&P 500 closed Tuesday within 0.5% of its record high, set early last year when interest rates were at historic lows, US futures were almost flat. Meanwhile, 10-year Treasury rates decreased 2 basis points in Asia trade after Tuesday's auctions drew purchasers, indicating that the market is pricing in strong Fed easing in 2024. The dollar is stable against the majority of major currencies.
- "Asia's recent trend will continue, with US markets rallying for the remainder of the week," said Redmond Wong, a strategist at Hong Kong-based Saxo Capital Markets. "China and Hong Kong, however, are likely to continue to lag and the rally in Hong Kong may be shortlived."
