Stocks in Asia experienced significant gains on Friday, driven by China’s efforts to stimulate its economy. Hong Kong’s Hang Seng index surged 3.7% to 20,659.03, while the Shanghai Composite index jumped 2.1% to 3,065.29. However, the Shanghai Stock Exchange encountered technical glitches that caused delays and hindered order processing at the market’s opening. As a result, investors flocked to the Shenzhen index, leading to a 6.4% increase. Trading resumed normally by noon, and the exchange is currently investigating the cause of the disruption.
In Japan, the Nikkei 225 index rose by over 1%, reaching 39,451.25, as the ruling Liberal Democratic Party conducted a leadership election to determine the country’s next prime minister. The change in leadership is not expected to result in significant policy shifts due to the similarities between the leading contenders.
China’s central bank announced measures to support the property industry and financial markets, including a cut in the reserve requirement for banks. These actions aimed to bolster the economy, which was reflected in the positive market sentiment.
Industrial profits in China declined by nearly 18% year-on-year in August, highlighting the challenges faced by the world’s second-largest economy. New World Development, a prominent Hong Kong property giant, saw its shares surge by 21.5% after its third-generation scion, Adrian Cheng, was replaced. The company reported an annual loss of over $2.4 billion last month, its first loss in nearly two decades.
In Japan, the consumer inflation rate in Tokyo, considered a leading indicator for the country, cooled to 2.2% year-on-year in September, aligning with market expectations. Meanwhile, Australia’s S&P/ASX 200 index added nearly 0.1% to 8,208.70, while South Korea’s Kospi index declined by 0.2% to 2,666.01.
On Wall Street, the S&P 500 reached an all-time high for the third time this week, closing at 5,745.37. The Dow Jones Industrial Average gained 0.6% to 42,175.11, and the Nasdaq composite rose 0.6% to 18,190.29. Micron Technology and Jabil led the way with significant jumps in their stock prices after reporting stronger-than-expected profits and revenues. However, Super Micro Computer experienced a sharp decline of 12.2% following reports of a Department of Justice investigation into the company’s server and storage systems.
The U.S. economy showed signs of performing better than anticipated, with fewer workers filing for unemployment benefits and the overall economy growing at a solid 3% annual rate during the spring. The Federal Reserve’s decision to lower interest rates aims to sustain steady economic growth and support corporate profits.