Asia markets are gaining as Hong Kong's Hang Seng surged by almost 3%

May 23, 2022: -On Friday, Shares in the Asia Pacific markets increased, along with Hong Kong stocks which led to gains as a volatile trading week came to a close.

The Hang Seng index shut up 2.96% at 20,717.24, while the Hang Seng Tech index spiked up 4.74% to finish the session at 4,284.42. Chinese stocks listed in Hong Kong completed higher, with Xpeng up 6.99% and Baidu is increasing 5.19%.

China kept its one-year benchmark, the lending rate, at 3.7% in other developments but cut its five-year loan prime rate by 15 basis points. It was the second cut this year.

“This is a long-anticipated move against Covid disruptions, and the reduction is over the expected market,” said Chaoping Zhu, a global market strategist and JPMorgan Asset Management.

Zhu said that bank loans have dropped sharply, signals a lack of confidence among businesses and households. The LPR cut off on Friday, with the reserve requirement ratio cut in April, helping to boost demand in the property and land market, Zhu further said.

Julian Evans-Pritchard, the senior China economist at Capital Economics, said the five-year LPR cut was the most important reduction on record and is aimed at supporting housing demand.

Mainland Chinese stocks increased on Friday. The Shanghai Composite closed 1.6% higher at 3,146.57, while the Shenzhen Component is gaining 1.82% to close at 11,454.53.

On Friday, Shares of Chinese electric vehicle maker Nio increased in its Singapore debut; the third exchange on its shares is listed. The stock popped at the open, which increased by almost 20% before paring most gains to close almost 2.4% higher.

Japan’s Nikkei 225 surged 1.27% to 26,739.03, and the Topix advanced 0.93% to 1,877.37. Reuters reported that core consumer prices in Japan, which include energy costs but not fresh food, surged 2.1% in April compared to before a year, in line with economists’ estimates.