The major Asia-Pacific stock indexes were mixed but mostly higher on Tuesday, led by more than two-percent gains in Hong Kong and South Korea. China struggled, however, as a rise in coronavirus cases offset the bullish gross domestic product data released on Monday. Analysts said the markets may have been underpinned by optimism ahead of remarks from U.S. President-elect Joe Biden’s nominee for Treasury secretary, Janet Yellen, later today.
In the cash market on Tuesday, Japan’s Nikkei 225 Index settled at 28633.46, up 391.25 or +1.39%. Hong Kong’s Hang Seng Index finished at 29642.28, up 779.51 or +2.70% and South Korea’s KOSPI Index closed at 3092.66, up 78.73 or +2.61%.
In China, the benchmark Shanghai Index settled at 3566.38, down 29.84 or -0.83% and Australia’s S&P/ASX 200 Index finished at 6742.60, up 79.60 or +1.19%.
Yellen Says US Must ‘Act Big’ on Next Coronavirus Relief Package
Janet Yellen, U.S. President-elect Joe Biden’s nominee to run the Treasury Department, will tell the Senate Finance Committee on Tuesday that the government must “act big” with its next coronavirus relief package.
“Neither the president-elect, nor I, propose this relief package without an appreciation for the country’s debt burden. But right now, with interest rates at historic lows, the smartest thing we can do is act big,” Yellen, a former Federal Reserve chair, said in a prepared opening statement for her hearing before the committee.
“I believe the benefits will far outweigh the costs, especially if we care about helping people who have been struggling for a very long time,” she said in the statement, which was obtained by Reuters.
Hong Kong Stocks End at 20-Month High on Mainland China Demand
Hong Kong stocks closed at a 20-month high on Tuesday, helped by steady and robust demand from investors in mainland China for shares in the Asian financial hub. Leading the gains, the Hang Seng Tech Index and the Hang Seng Financials Index both closed 2.8% higher.
Mainland China investors purchased 26.1 billion Yuan ($4.02 billion) worth of Hong Kong stocks on Tuesday via the Stock Connect linking mainland and Hong Kong, after spending a record HK$23 billion on Monday, according to HKEX and Refinitiv data.
China Stocks Retreat on Coronavirus Worries
China shares fell on Tuesday as a resurgence of COVID-19 cases hit market sentiment, with consumer discretionary and materials stocks leading the retreat.
Leading the decline, the CSI300 Consumer Discretionary Index dropped 2.9%, while the CSI300 materials Index slid 2.7%.
China is battling the worst outbreak of COVID-19 since March 2020, with one province posting a record daily rise in cases, as an independent panel reviewing the global pandemic said China could have acted more forcefully to curb the initial outbreak.
China will provide necessary policy support for the economic recovery this year, to avoid a “policy cliff”, as small firms remain hard-pressed amid the pandemic, a senior official at the state planner said.
South Korean Stocks See Best Day in Over a Week on Samsung Electric, Hyundai Motor Boost
South Korean shares rebounded to end higher on Tuesday, marking its sharpest gain since January 8, boosted by shares of Samsung Electronics and Hyundai Motor, and upbeat Chinese data from Monday.
An 11.2% gain in auto stocks was the biggest boost, with the country’s largest carmaker Hyundai Motor surging as much as 8.5%. Chip giant Samsung Electronics also jumped as much as 3.5%, recovering from its sharpest decline in five months on Monday after its group leader was sentenced to a 30-month jail term.
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