Asian Shares Mixed As China’s Xi Begins 3rd Term

Asian markets ended mixed on Monday, with Chinese and Hong Kong stocks suffering heavy losses as China’s Communist Party ended its 20th National Congress over the weekend with no signs of a significant change in the zero-COVID policy that has crimped business and trade.

In addition, Xi Jinping, who secured a third term as Chinese President, indicated no changes in policies straining relations with Washington and Asian neighbors.

Markets in Japan, South Korea and Australia rose amid hopes that the U.S. central bank may adopt a less aggressive policy stance after an expected 75 basis-point rate hike when Fed policymakers meet next week.

The dollar stayed strong as suspected Bank of Japan intervention gave only brief respite to the Japanese yen. Oil prices fell more than 1 percent in Asian trading after customs data showed China’s crude imports fell 2 percent from a year earlier in September.

China’s Shanghai Composite Index tumbled 2.0 percent to 2,977.56 after official data showed GDP grew well below target in the third quarter.

GDP rose an annual 3.9 percent, beating forecasts for 3.3 percent growth but well short of the official full-year target of 5.5 percent, which is already its lowest in three decades.

The delayed release of other economic data for September painted a mixed picture of the world’s second-largest economy. Hong Kong’s Hang Seng Index plunged 6.4 percent to 15,180.69, dragged down tech stocks.

Japanese shares eked out modest gains after U.S. stocks soared on Friday following a Wall Street Journal report that some Fed officials are concerned about tightening policy too much.

The Nikkei 225 Index ended 0.3 percent higher at 26,974.90, giving up some early gains on concerns about the outlook for China’s economy and a deepening sell-off in Hong Kong.

The broader Topix edged up 0.3 percent to 1,887.19, with chip-related companies like Tokyo Electron, Screen Holdings and Advantest climbing 2-3 percent.

Seoul stocks rose sharply to snap a three-day losing streak after financial authorities pledged at least 50 trillion won ($34.7 billion) in support for credit markets that have been strained by rising interest rates.

The Kospi rallied 1.0 percent to 2,236.16, with construction and tech companies leading the surge. Battery materials producer POSCO Chemical jumped 4 percent after reporting its largest quarterly operating profit for the third quarter ever.

Australian markets posted strong gains as higher bullion prices helped lift gold miners. Newcrest Mining, Regis Resources and Northern Star Resources jumped 3-5 percent.

The benchmark S&P/ASX 200 Index jumped 1.5 percent to 6,779.40, while the broader All Ordinaries Index ended 1.6 percent higher at 6,978.40.

Markets in New Zealand were closed for a public holiday.

U.S. stocks rallied on Friday to notch their best week since June, as treasury yields showed a notable downturn on reports that Fed officials will likely debate a smaller interest rate hike in December following a widely expected 75 basis point increase in early November.

The Dow climbed 2.5 percent to reach its best closing level in over a month, the tech-heavy Nasdaq Composite surged 2.3 percent and the S&P 500 added 2.4 percent.

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