Hong Kong Stocks Finish Well Up, In Line With Region

Hong Kong stocks jumped more than one percent on Tuesday, in line with an Asia-wide advance, as hopes for the global recovery outweighed worries about a spike in infections in parts of the region.

The Hang Seng Index rallied 1.4 percent, or 399 points, to 28,593.

Across the border, the benchmark Shanghai Composite Index added 0.3 percent, while the Shenzhen Composite Index on the mainland's second exchange added 0.2 percent.

Traders built on a broadly positive previous day, despite a retreat on Wall Street, bringing some much-needed stability after last week's topsy-turvy performance as Federal Reserve officials continue to reassure that fears of long-term, red-hot inflation were misplaced.

The key event this week is the release of minutes from the US central bank's April policy meeting, which will be scanned for clues about board members' views on price rises as the world's top economy bursts back to life as vaccines allow further reopenings.

There is a worry that the explosive rebound will push inflation so high that the Fed will have to tighten interest rates or wind back other easing measures to keep the situation from running out of control.

In the latest bid to soothe concerns, Fed Vice Chair Richard Clarida said "it may take more time to reopen a US$20 trillion economy than it did to shut it down", while Atlanta Fed chief Raphael Bostic told CNBC that not enough progress had been made in fighting unemployment to warrant making any moves now.

Tokyo led gains, piling on more than two percent in the face of data showing the Japanese economy contracted more than expected in the first three months of the year, breaking a run of two straight periods of growth, as it was hit by new containment measures.

Major parts of the country, including Tokyo, have been under states of emergency, with people urged to stay at home and restaurants told to close earlier. The outbreak has raised concerns that the already delayed summer Olympics could be called off again.

Seoul, Singapore, Mumbai and Bangkok rose more than one percent, while there were also gains in Wellington and Sydney.

Taipei soared more than five percent as tech firms enjoyed some bargain-buying, having been battered in recent weeks by inflation fears – tech firms are more susceptible to higher interest rates. (AFP)