Yahoo Finance Asian Stocks Rise Ahead of Brexit Vote; Chinese Stocks Gain on Stimulus Hope
Investing.com - Asian stocks rose in morning trade on Tuesday, as investors now turned their focus to the upcoming vote on U.K. Prime Minister Theresa May’s Brexit deal to leave the European Union.
China’s Shanghai Composite gained 1% while the Shenzhen Component also traded 1.3% higher by 9:11 PM ET (02:11 GMT). Hong Kong’s Hang Seng Index jumped 1.9%.
The gain in Chinese stocks came after reports that Beijing vowed tax cuts on a larger scale to help support its slowing economy.
On Monday, data showed China’s exports in December unexpectedly shrank the most in 2 years, putting Chinese equities under pressure.
“There are two macro events that continue to weigh on market perspective,” Frances Donald, head of macroeconomic strategy at Manulife Asset Management, said in an interview.
“The first is where is global growth heading next, and weak Chinese trade data would suggest that global growth is certainly not bottomed as of yet. And the second issue is the persistence of the U.S. government shutdown and how that muddies our perspective about what happens next.”
Meanwhile, Japan’s Nikkei 225 rose 1.0%, and South Korea’s KOSPI gained 1.4%.
Down under, Australia’s ASX 200 was up 0.6%.
In other news, Brexit returned to focus this week as the U.K. parliament is expected to vote down Prime Minister Theresa May’s Brexit plan. While the defeat is widely anticipated by the market, it could still trigger a volatile knee-jerk market reaction, analysts said.
"We could see knee-jerk volatility. She could lose by a historic margin. This could be a historic loss by the government," said Marc Chandler, Bannockburn Global Forex chief market strategist.
"If the government gets crushed, then you have a big risk off move," said Michael Schumacher, director of rate strategy at Wells Fargo (NYSE:WFC). "If it's a close defeat, you might see equities do okay."
Related Articles
Netflix Earnings Beat, Revenue Misses; Stock Falls
U.S. stocks higher at close of trade; Dow Jones Industrial Average up 0.67%
