Asian stocks rise; China up on repo rate cut, Australia hit by retailer losses

Most Asian stocks rose slightly on Monday amid persistent cheer over lower interest rates, while Australian markets lagged as major retail stocks fell sharply in the face of an antitrust lawsuit. 

Chinese markets advanced after the People’s Bank of China cut a short-term lending rate, although overall gains were limited.

Regional trading volumes were held back by a market holiday in Japan. A weak Friday close on Wall Street also made for middling cues, although U.S. stock index futures rose in Asian trade. 

But Asian markets were sitting on strong gains from the prior week, as sentiment was boosted by an interest rate cut by the Federal Reserve, with the central bank also kicking off an easing cycle. 

Markets were awaiting a string of key signals from the U.S. for more insight into the Fed, with several officials set to speak this week. Key inflation data is also on tap.  Chinese markets rise after repo rate cut 

China’s Shanghai Shenzhen CSI 300 and Shanghai Composite indexes rose 0.5% and 0.4%, respectively, while Hong Kong’s Hang Seng index added 0.7%. 

The PBOC cut its 14-day reverse repo rate to 1.85% from 1.95%, further loosening local monetary conditions to help boost economic growth. 

But the move came just days after the PBOC disappointed markets by leaving its benchmark loan prime rate unchanged. Chinese indexes were still trading just above seven-month lows hit earlier in September. 

Investors have been calling on Beijing to roll out more stimulus measures amid few signs of an economic pick-up in the country.  Australian stocks hit by retailer losses, RBA on tap 

Australia’s ASX 200 was the worst performer in Asia, losing 0.6% as it fell from record highs. 

Losses in supermarket giants Woolworths Ltd (ASX:WOW ) and Coles Group (OTC:CLEGF ) Ltd (ASX:COL ) were the biggest weights, with the two falling between 3% and 4% after Australia’s competition regulator sued the two for allegedly misleading customers over discounts. 

Sentiment towards Australia was also frail before the conclusion of a Reserve Bank of Australia meeting on Tuesday. While the RBA is not expected to hike interest rates, it is expected to strike a hawkish chord in the face of persistent labor market strength and sticky inflation. 

Broader Asian markets drifted higher amid persistent cheer over lower interest rates. Nikkei 225 Futures rose 0.9%, as local markets were closed for a holiday.

South Korea’s KOSPI added 0.1%, while futures for India’s Nifty 50 index pointed to a positive open, with the index now in sight of record highs at 26,000 points. 

Source: Investing.com