Yahoo Finance Asian Markets Rise; China Unexpectedly Keeps LPR Unchanged
By Alex Ho
Investing.com - Asian markets ended the week with a much needed reprieve from days of heavy losses.
China fixed its 1-year Loan Prime Rate (LPR) on Friday morning at 4.05%, the same as a month earlier. China also set the 5-year LPR at 4.75%, also unchanged from a month earlier.
The hold defied investors’ expectations for a cut which would have been in line with moves by central banks around the world. Central banks have been cutting rates and offering stimulus packages to stave off a recession caused by the COVID-19 pandemic.
China’s Shanghai Composite gained 1.15% by 9:57 PM ET (1:57 AM GMT) while the Shenzhen Component was up by 1.13%. Hong Kong’s Hang Seng Index was up by 3.38%, reversing losses shortly after markets opened.
In Australia, Treasurer Josh Frydenberg hinted during an interview with Sky News Friday morning at a second stimulus package that will be “significantly bigger” than last week’s A$17.6 billion ($10.7 billion) package. On Thursday, the Federal Reserve Bank of Australia cut interest rates to 0.25%.
The ASX 200 rebounded from losses a day earlier and was up 3.25%.
Elsewhere, South Korea’s KOSPI was up 3.16%.
Japan’s Nikkei 225 is closed for a national holiday.
But investors remain wary that the worst from the COVID-19 novel coronavirus is far from over. Bridgewater founder Ray Dalio warned in an interview with CNBC: “What’s happening has not happened in our lifetime before ... what we have is a crisis.”
He estimated the price tag for U.S. corporations could be up to $4 trillion.
“There will also be individuals who have very big losses. ... There’s a need for the government to spend more money, a lot more money,” Dalio said.
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