HONG KONG, Jan 16 (Reuters) - China and Hong Kong shares edged up on Thursday to join a broader rally in Asia, with sentiment buoyed by state media reports of potential easing measures from Beijing in coming weeks.
** At the midday break, the Shanghai Composite index .SSEC was up 0.21% at 3,233.92 points.
** The blue-chip CSI300 index .CSI300 was up 0.02%, with its financial sector sub-index .CSI300FS higher by 0.41%.
** In Hong Kong, the benchmark Hang Seng Index .HSI was up 0.83% at 19,445.68.
** Sentiment was largely upbeat across Asia as traders raised bets on potential rate cuts by the Federal Reserve this year following an easing core U.S. inflation.
** Around the region, MSCI's Asia ex-Japan stock index .MIAPJ0000PUS was firmer by 1.19% while Japan's Nikkei index .N225 was up 0.28%.
** Investors are also anticipating more easing measures from Beijing after state media reported that China's central bank may cut banks' reserve requirement ratio $(RRR)$ before the Spring Festival at the end of this month.
** As room for interest rate cuts is curtailed by the yuan depreciation pressure, an RRR cut could send a clearer signal to ease the policy void until March, and is a straightforward instrument to offer permanent liquidity, analysts at Bank of America said in a note to clients.
** Limiting gains on Thursday, chip stocks .CSI931865 declined 0.5%, with AI firm Cambricon Technologies .688256.SS tumbling over 11% after the U.S. escalated its tech curbs and added more Chinese entities to a U.S. restricted trade list.
** The property sector .CSI000952 also weakened as developer China Vanke faced renewed scrutiny over its debt repayment capabilities amid a challenging property market.
** Two of its yuan bonds plummeted over 20% on Thursday, leading to trading suspensions.
(Reporting by Hong Kong Newsroom; Editing by Mrigank Dhaniwala)
((jiaxing.li@tr.com))
Comments