Asian shares pared losses as investor sentiment improved on China’s reported plans to tackle a debt crisis in real estate development.
MSCI’s broadest gauge of Asia stocks outside Japan (.MIAPJ0000PUS) bounced back to a gain of 0.36% in afternoon sessions. Chinese stocks jumped after reports the country would set up a fund of up to $44 billion to help property developers.
Hong Kong’s Hang Seng Index (.HSI) was 1.48% higher and China’s benchmark CSI300 Index (.CSI300) also widened gains to a rise of 0.91% at the morning close. Japan’s Nikkei (.N225) fell 0.08%, erasing some morning losses.
Investors are also awaiting a likely 75 basis point Federal Reserve interest rate increase later this week – with markets pricing about a 10% risk of a larger hike, as well as waiting to see whether economic warning signs prompt a shift in rhetoric. The yen steadied at 136.54 per dollar. The U.S. dollar index , which touched a 20-year high this month, was down slightly at 106.380.
Oil prices rose further on expectations Russia’s reduction in natural gas supply to Europe could encourage a switch to crude, with Brent futures last up 1.27% at $106.45 a barrel and U.S. crude up 1.26% at $97.92 a barrel. Benchmark 10-year Treasury yields fell to 2.875% as growth worries gave support to bonds. Gold hovered at $1,721.8 an ounce and bitcoin nursed overnight losses at $21,111.31.