Hong Kong: Hong Kong stocks soared more than four percent at the open of trade Wednesday as investors returned from a public holiday to play catch-up, with a global rally fuelled by easing concerns about central bank interest rate hikes.
The Hang Seng Index rocketed up 4.29 percent, or 732.46 points to 18,811.97, while mainland Chinese markets are closed all week for a national holiday.
Asian stocks extended a rally on Wednesday following the best two-day run for US equities in more than two years, as investors begin to anticipate a slowing to central bank tightening that could jolt risk assets higher.
Australian, Japanese and South Korean equities traded higher, bolstering a rally on Tuesday as improving risk sentiment drags global equities from oversold levels. The S&P 500 climbed 3.1% and European stocks jumped by the biggest margin since March. Elon Musk revived his $44 billion bid for Twitter Inc., which soared 22%.
US job, financial stability
A decline in US job openings provided evidence the labor market may be cooling, offering hope the Federal Reserve may soon slow its rate-hiking path.
A Fed official suggested the Fed still had further to go in tightening monetary policy to combat inflation, however, dimming hopes the central bank would follow the Reserve Bank of Australia, which increased rates less than anticipated on Tuesday.
"Last week's pivot by the Bank of England seems to have convinced investors that the Fed now must give more weight to financial stability, which means that the current monetary tightening cycle might end sooner rather than later," said Ed Yardeni, president of his eponymous research firm, in a note.
A Bloomberg index of the dollar steadied after falling 3% from a peak last week. The pound inched lower after climbing on Tuesday to the highest level in two weeks. The price of oil traded flat after jumping on Tuesday as OPEC+ said it was considering an output cut of as much as 2 million barrels a day, double prior estimates.
Investors will be keenly focused on Friday's US jobs data that economists anticipate is set to show a slowing in new jobs added.
"For the market to continue higher, the jobs data will have to be in-line with, or short of expectations," said Lindsey Bell, chief markets and money strategist at Ally. The market is currently anticipating a "goldilocks" labor-market report that's "not too hot and not too cold."