Asian Shares Close Mostly Lower Amid Rising Uncertainties in China

The major Asia-Pacific stock markets are trading mostly lower on Wednesday, bucking the trend set by Wall Street overnight. Weighing on the markets is a firm dollar and slight rise in U.S. Treasury yields as the risks of a global recession continued to dampen investor outlook even as corporate earnings in the United States alleviated some growth fears.

Other catalysts behind the selling pressure are nervous investors in China amid the ongoing Party Congress and higher-than-expected UK inflation readings.

Japan’s Nikkei 225 Index settled at 27257.38, up 101.24 or +0.37%. Hong Kong’s Hang Seng Index is trading 16588.25, down 326.33 or -1.93% and South Korea’s KOSPI Index finished at 2237.44, down 12.51 or -0.56%.

In Australia, the S&P/ASX 200 Index settled at 6800.10, up 20.90 or +0.31% and in China, the benchmark Shanghai Index is trading 2237.4, down 12.51 or -0.56%.

China, Hong Kong Shares Fall on Caution During Party Congress

China stocks fell on Wednesday, as investors were cautious amid uncertainties during the Communist Party congress, even as a raft of state-backed and large asset managers announced measures to stabilize the market, Reuters reported.

At least 21 large onshore China asset managers including E Fund Management Co, Invesco Great Wall Fund Management, and Bank of Communications Schroder Fund Management said this week they were investing their own money to buy products in a bid to stabilize the confidence on China’s capital market, local media reported.

Hong Kong’s Chief Executive John Lee Fails to Impress Investors

In his first policy address since he took office in July, Lee said the government would set aside billions to attract businesses to the city, and launch a so-called top talent pass scheme to “entice talents to pursue their careers in Hong Kong,” CNBC reported.

Hong Kong has lost thousands of residents since the pandemic started, worsening a “brain drain” from the international financial hub.

Shares fell after Lee announced the government will set aside 30 billion Hong Kong dollars ($3.8 billion) to attract businesses to the city, and launch a so-called top talent pass scheme to “entice talents to pursue their careers in Hong Kong.”

Australian Shares Post Modest Gain

Australia’s S&P/ASX 200 Index traders shrugged off weaker crude oil prices to close marginally higher for the session. The index was lifted by lithium miner shares and travel stocks such as Quantas. The best performing issue on the benchmark index was Core Lithium, up 8.2 percent.

Shares in former tech darling Megaport plunged 22.1 percent after its sales growth for the September quarter missed analysts’ expectations. The internet connectivity business said total revenue for the quarter was $33.7 million, up 10 percent on the prior quarter.

Investors Remain Nervous

Wednesday’s sessions opened with high expectations following strong gains across the board on Wall Street on Tuesday, but the subsequent buying wasn’t strong enough to sustain the rally.

The divergence from Wall Street suggests sellers are still in control in Asia. A lower trade on Thursday could wipe out all of this week’s previous gains.