Asia stocks gain on hopes for China stimulus, Fed pause

Most Asia-Pacific stocks markets have strengthened as expectations for stimulus from China and overnight gains on Wall Street boost the mood. MSCI's broadest index of Asia-Pacific shares outside Japan gained 0.7 in morning trade on Wednesday. China's benchmark equity index rose 0.3 per cent, while Hong Kong's Hang Seng added 1.2 per cent. On Tuesday, China reportedly asked the biggest banks to cut deposit rates to boost the economy. Speculation of policy support for the troubled property sector has been lifting those shares in the past week. Japan was an outlier, with the Nikkei sliding 1.1 per cent after touching a 33-year high on Tuesday. "Overall, across the board, assets are doing pretty well," said Yuting Shao, macro strategist at State Street Global Markets. "The US debt ceiling uncertainty (has been) removed (and) hope on China to introduce more help to the economy is also a good sign for the market." The US S&P 500 ended higher on Tuesday, continuing to gain support from strengthening bets that the Federal Reserve will hold interest rates steady at its policy meeting next week. The two-year Treasury yield, which typically moves in step with interest rate expectations, fell slightly to about 4.5 per cent in Tokyo, from Tuesday's close at 4.516 per cent. The yield on 10-year notes slipped to about 3.67 per cent. The US dollar index slipped by 0.04 per cent to 104.03. The Australian dollar reached its highest since mid-May at $US0.6690 ($A1.0025), extending a rally following a central bank rate increase on Tuesday. Oil prices steadied on Wednesday after the previous session's losses, as demand concerns owing to slow global economic growth were offset by expectations of tighter global supply following Saudi Arabia's pledge to deepen output cuts. US crude was flat at $US71.74 ($A107.51) a barrel. Brent crude eased to $US76.25 ($A114.26) per barrel. Gold was slightly higher, trading at $US1,965.19 ($A2,944.94) per ounce. Leading cryptocurrency bitcoin was trading at about $US27,000 ($A40,461), consolidating following a sharp overnight rebound from as low as $US25,350 ($A37,988). The token has been a paradoxical beneficiary of a US Securities and Exchange Commission (SEC) crackdown on cryptocurrency exchanges, and the classification of tokens including Solana, Cardano and Polygon as securities. "The SEC is making life nearly impossible for several altcoins," said Oanda senior market analyst Ed Moya. "And that is actually driving some crypto traders back into Bitcoin."