Asian stocks rise on China stimulus cheer; Australia lags before RBA By

-- Most Asian stocks rose on did tr foreign exchange collapsedTuesday with Chinese markets leading gains on reports of more stimulus measures from Beijing, while Australian markets lagged before a Reserve Bank meeting. 

Regional markets took some positive cues from mild overnight gains on Wall Street, with U.S. markets remaining in sight of record highs. But Wall Street futures retreated in Asian trade, suggesting that a recent rally may now be stalling. 

Most Asian markets were sitting on strong gains from the past week, as investors cheered a bumper interest rate cut by the Federal Reserve. Focus this week is on more cues from the Fed and the U.S. economy.

Chinese stocks surge on stimulus 

China’s and indexes rose 0.5% and 0.7%, respectively, while Hong Kong’s index rose 1.8% and was the best performer in Asia. 

Chinese officials unveiled a slew of planned measures to further spur economic growth, with the People’s Bank set to cut reserve requirements for banks by 50 basis points to unlock more liquidity.

For the ailing property market, the government said it would reduce mortgage rates for existing loans. Bloomberg reported that the government was planning at least 500 billion yuan ($70.8 billion) of liquidity support for local stocks. 

Tuesday’s moves come after the PBOC had on Monday cut a short-term repo rate to further boost liquidity. The moves are aimed squarely at shoring up economic growth, as the Chinese economy struggles with persistent disinflation and an extended property market downturn. 

The CSI300 and SSEC indexes both hit near eight-month lows in recent sessions, while the Hang Seng was also nursing recent losses. 

Broader Asian markets advanced. Japan’s index rose 0.8%, while the added 0.5%, as purchasing managers index data showed the country’s grew more than expected in September. 

But Japanese shrank for a third consecutive month. 

South Korea’s traded flat, while futures for India’s index pointed to a slightly weak open, with the index facing resistance in the run-up to 26,000 points. 

Australian stocks lag with RBA on tap 

Australia’s was the worst performer in Asia, losing 0.5% before the conclusion of a Reserve Bank of Australia meeting later in the day. 

The RBA is widely expected to , but is also set to strike a hawkish chord amid sticky Australian inflation and strength in the labor market. 

The central bank is likely to signal that interest rates will remain high for longer, and is also expected to reiterate its warning of future rate hikes. 

inflation data, due on Wednesday, is set to offer more cues on the Australian economy. 

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