Hang Seng Index, ASX200, Nikkei 225: Hang Seng in Breakout Mode

• It was a bullish morning for the Asian markets, with the Nikkei and the Hang Seng Index leading the way.
• The Asian markets took their cues from the US markets, with bank stocks driving demand for riskier assets as fears of a banking crisis ebbed away.
• There were no economic indicators to influence sentiment, leaving investors to look ahead to the Fed monetary policy decision and projections later today.

Market Overview

It was a bullish morning for the Asian markets. The Hang Seng Index and the Nikkei 225 led the morning breakout.

Investors responded to a bullish US session, with the US government and regulators wiping out fears of a banking crisis. US bank stocks rallied, supporting the bullish morning session. Crude oil also responded to the shift in sentiment, with Brent Crude returning to the $75 handle on Tuesday.

The NASDAQ Composite Index rose by 1.58% on Tuesday, with the Dow and S&P 500 seeing gains of 0.98% and 1.30%, respectively.

However, the morning gains came despite uncertainty ahead of the Fed interest rate decision, FOMC projections, and the Fed Chair Powell press conference. The markets expect a 25-basis point Fed rate hike, a post-March pause, and an H2 2023 rate cut.

ASX 200

The ASX 200 was up 0.98%, with mining and bank stocks on the rise for a second consecutive day. There were no economic indicators to move the dial, while risk-on sentiment supported crude oil and commodity prices on Tuesday.

It was a bullish morning for the big-4, with Commonwealth Bank of Australia (CBA) rising by 1.37%. ANZ Group (ANZ) was up 0.88%, with Westpac Banking Corp (WBC) and National Australia Bank (NAB) seeing gains of 0.75% and 0.71%, respectively.

Mining stocks were also in the green. Rio Tinto (RIO) and BHP Group Ltd (BHP) rose by 0.29% and 0.26%, respectively, with Fortescue Metals Group (FMG) up 1.11%. Newcrest Mining (NCM) bucked the trend, falling by 1.65%.

Oil stocks joined the broader market in the green. Woodside Energy Group (WDS) and Santos Ltd (STO) rose by 5.31% and 3.55%, respectively. While overnight gains in crude oil delivered morning support, crude oil prices were back in the red this morning, with Brent Crude down 0.49% to $74.95.

Hang Seng Index

The Hang Seng was 1.92% this morning. Fear of a global banking crisis subsided, with bets of a less hawkish Fed supporting a breakout session.

Considering the main components, Tencent Holdings Ltd (HK:0700) and Alibaba Group Holding Ltd (HK:9988) rose by 2.04% and 3.60%, respectively.

It was also a bullish morning for banking stocks. HSBC Holdings PLC was up 3.47%, with Industrial and Commercial Bank of China (HK:1398) and China Construction Bank (HK: 0939) seeing gains of 0.96% and 1.40%, respectively.

CNOOC (HK: 0883) rose by 1.77%.

Nikkei 225

The Nikkei 225 was up 2.08% this morning, with subsiding Fed Fear and easing risks of a global financial crisis providing support. News of the Japanese government planning to spend 2 trillion Yen to ease inflation pain contributed to the upside.

Sumitomo Mitsui Financial Group (8316) and Mitsubishi UFJ Financial Group rose by 2.22% and 3.56%, respectively.

Looking at the main components, it was a sea of green. SoftBank Group Corp. (9984) rallied by 3.05%, with Fast Retailing Co (9983) and Tokyo Electron (8035) seeing gains of 2.15% and 2.01%, respectively.

Sony Corp (6758) and KDDI Corp (9433) saw relatively modest gains of 1.60% and 1.28%, respectively.

Check out our economic calendar for today’s economic events.