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BEIJING/HONG KONG: Asian stocks followed a sell-off in global equities on Friday as indications of a rate hike from the European Central Bank and nervousness over upcoming US inflation data stoked concerns over global growth , while shares in China rose on hopes of policy easing, according to Reuters.

MSCI’s broadest index of Asia-Pacific stocks outside Japan fell 0.9%, weighed down by a 1.2% drop in resource-rich Australia and a 1.5% pullback in South Korea. . The Japanese Nikkei fell 1.4%.

The fall should continue when European markets open. Pan-regional Euro Stoxx 50 futures fell 0.99%, German DAX futures fell 0.92%, FTSE futures fell 0.87%.

However, continued heavy buying by foreign investors and cautious hopes of easing regulations on tech companies drove Chinese stocks higher on Friday, despite news that the cities of Beijing and Shaanghai were back on high alert. COVID-19.

China’s blue-chip CSI300 index rose 0.41%, while Hong Kong stocks pared earlier losses to 0.2%.

The Hong Kong-listed tech giants, which were hit hard at the start of trading, reversed losses to rise 0.9%, due to a change in fortunes in Hong Kong shares of Alibaba, which increased by 1.8%.

Reuters reported that Chinese authorities had given billionaire Jack Ma’s Ant Group a tentative green light to relaunch its initial public offering, following a Bloomberg report that China was considering reviving the IPO.

Despite denials from the company and the securities regulator, investors saw it as a sign that a long regulatory crackdown on tech companies is easing, in line with the broad dovish stance recently adopted by top policymakers. Chinese.

“It’s a signal that Beijing has come out to tell you that they’ve moved from repression to support, so there’s not a lot of uncertainty anymore,” said Jason Hsu, founder and CIO of Rayliant Global Advisers.

“China is now starting to enter an easing circle, which is definitely a good thing for the stock market. Stocks have fallen a lot before, so now they’re going to come back up and make up for the losses. I think that’s something something to look forward to.

Factory outlet inflation in China slowed to its slowest pace in 14 months in May due to tight COVID-19 restrictions, while consumer inflation also remained subdued.

This would allow China’s central bank to release more stimulus to support the economy even as monetary authorities in most other countries strive to reduce inflation with aggressive interest rate hikes.

On Thursday, the European Central Bank announced that it would make its first interest rate hike since 2011 next month, followed by a potentially larger hike in September.

“Global equities came under pressure after the ECB issued guidance, and (ECB President Christine) Lagarde noted upside inflation risks,” ANZ analysts said in a note on Friday. .

“And with energy prices continuing to rise, it’s not yet clear that inflation has peaked. The Fed’s policy guidance and actions may need to become more hawkish for longer. Markets financiers are nervous.

Investors expect the Federal Reserve to raise interest rates by 50 basis points next week, especially if consumer price data in the United States confirms high inflation on Friday.

The consensus forecast calls for a year-over-year inflation rate for May of 8.3%, unchanged from April.

Stocks on Wall Street fell as the market awaited price data. The S&P 500 and Nasdaq fell more than 2% in their largest daily percentage declines since mid-May.

In currency markets, the US dollar eased 0.2% against a basket of major currencies, pulling away from its highest level in three weeks ahead of the US inflation report.

On Friday, the two-year yield, which rises on traders’ expectations of a hike in the fed funds rate, continued its climb to hover around the highest level since early May. It touched 2.8352% from a US close of 2.817%.

The yield on the benchmark 10-year Treasury also rose slightly to 3.0568% from its US close of 3.042% on Thursday.

Oil prices fell after parts of Shanghai imposed new lockdowns. U.S. crude fell 0.52% to $120.88 a barrel. Brent fell 0.6% to $122.38 a barrel.

Gold fell slightly on Friday and headed for a weekly fall as Treasury yields rose. Spot gold was trading at $1,844.58 an ounce.

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