Stocks Surge as China Pledge Revives Risk Appetite: Markets Wrap

(Bloomberg) — Stocks surged Wednesday and U.S. futures climbed after China moved to ease a range of concerns spanning regulation to overseas listings, lifting sentiment after weeks of worries about war and high inflation. Treasury yields rose ahead of the Federal Reserve rates decision.

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The Stoxx Europe 600 index jumped about 1.8% at the open, led by travel and leisure, consumer products and financial services. An Asia-Pacific share gauge advanced the most since 2020, a measure tracking mainland companies listed in Hong Kong posted the biggest gain since the global financial crisis and a Chinese tech index soared a record 20%. Contracts on the tech-heavy Nasdaq 100 climbed more than 1% while those on the S%P 500 also rose.

China vowed policies to boost financial markets and spur economic growth as it attempted to ease fears on risks related to the ailing property sector, overseas listings and a clampdown on internet firms. That touched on many of the concerns that have soured China’s outlook for some time.

Equities in China and Hong Kong had been under pressure — shedding about $1.5 trillion combined over the first two days this week — in part on speculation that Beijing’s ties with Russia raise the risk of a U.S. backlash.

“The market was indeed oversold, irrational, in the dramatic rout, so real money is back doing bottom fishing,” said Castor Pang, head of research at Core Pacific Yamaichi.

West Texas Intermediate crude oil advanced, while staying below $100 a barrel. Treasuries fell, taking 10-year and 30-year yields to the highest since 2019 ahead of the Fed decision later Wednesday. The yuan strengthened and a dollar gauge dipped.

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A quarter-point Fed rate increase, the first since 2018, to fight high inflation is widely anticipated but there’s less certainty beyond that. While markets expect a total of seven such moves this year, policy makers also have to factor in growth risks emanating from Russia’s invasion of Ukraine.

“We will be closely watching the Fed’s dot plot, which we expect to signal five or…


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