Asian Stock Market: China, Japan portray cautious optimism, Indian equities grind lower

• Asia-Pacific markets pare BOJ-linked losses despite mixed news from China, Japan.
• Pullback in Treasury bond yields, hopes of more stimulus add strength to the positive mood.
• Hong Kong braces for best run-up in two weeks as China unveiled pro-growth policies.
• RBI’s rejection to an abrupt pause to the rate hike trajectory weighs on Indian shares.

Asian shares grind higher, mostly positive, as traders cheer softer Treasury yields and upbeat headlines from the regional leaders China and Japan. In doing so, the equity traders also benefit from a lack of major data/events while ignoring the Covid-linked market fears.

While portraying the mood, MSCI’s Index of Asia-Pacific shares outside Japan extends the previous day’s rebound, up near 1.0% intraday, whereas Japan’s Nikkei 225 adds half a percent to 26,505 ahead of Thursday’s European session.

Japanese government revises growth forecasts for the fiscal year 2023. “Japan's real gross domestic product (GDP) is expected to expand 1.5% in the fiscal year beginning in April 2023, the government said in its new semi-annual projection, up from 1.1% in the previous forecast made in July,” mentioned Reuters. On the same line were comments from Japanese Prime Minister (PM) Fumio Kishida who pushed local industries for 100 trillion Japanese Yen investment as soon as possible.

On the other hand, policymakers in China brace for pro-growth steps as hospitals in Shanghai eye more virus cases. On the same line could be the People’s Bank of China’s (PBOC) pledge to help overcome a slump in the local property market.

With this in mind, Hong Kong’s Hang Seng rises 2.55% intraday to lead the region’s gainers while India’s BSE Sensex drops 0.40% on a day to buck the trend.

Stocks in Australia ignore fears of a slowdown in spending, as conveyed by local banks, whereas those from New Zealand cheer optimism in Beijing to print daily gains.

On a broader front, the S&P 500 Futures rise 0.30% intraday to 3,916 whereas the US 10-year Treasury yields remain depressed around 3.65%, extending the previous day’s pullback from the monthly high.

Given the holiday mood, the markets may witness lackluster moves but final prints of the US Gross Domestic Product (GDP) and Core Personal Consumption Expenditure (PCE) details for the third quarter (Q3) could entertain traders ahead of Friday’s US Core PCE Price Index for November, also known as the Fed’s preferred inflation gauge. That said, the US GDP is expected to confirm 2.9% Annualized growth in Q3 while the Core PCE is anticipated to also meet the initial forecasts of 4.6% QoQ during the stated period.