Asian equities were higher today after a surprise cut by China on Friday and an upbeat Wall Street session lifted sentiment.
The raced 2.20% higher, while the rallied by 1.0%. Notably, China’s Mainland markets and its nearby neighbors were outperforming. China’s was 1.0% higher, with the leaping by 1.60%.
US index futures eased slightly by around 0.20% earlier today, but the move looked corrective after a powerful Wall Street session on Friday. The , and all hit record highs on Friday. The S&P 500 rose 1.13%, the NASDAQ climbed 0.98%, and the Dow Jones rose 1.30%.
Across regional Asia, stocks were also higher, although less so than in Northern Asia. The expanding China tech-clampdown has muted sentiment in , which was just 0.40% higher.
was 0.25% higher, with climbing 0.85%. rose 0.80% on commodity prices and IPO fever, but fell by 0.40%, with politics and COVID-19 cases weighing on sentiment.
Australian markets were shrugging off the Sydney lockdown for now, following US markets and the China RRR rally higher. The rose 0.80%, while the climbed higher by 0.70%.
Northern Asian markets with high beta and geographic location to China were outperforming today. However, that rally may run out of steam as the week progresses if China’s tier-1 data releases suggest the pace of the recovery there is slowing.
It would inevitably weigh on sentiment across the rest of the region, with the Asia-Pacific as a whole-ex China, grappling with the cold hard realities of COVID-19.
Additionally, a plus US Core CPI this week is likely to see EM outflows increase, and DM markets outperform, notably the Northern hemisphere heavyweights.