China’s fiery rally takes a break to await stimulus By Reuters

SINGAPORE (Reuters) – Chinese shares fell on Wednesday and commodities sustained sharp losses as investors tempered enthusiasm for a Chinese economic recovery, while broader markets held up on expectations that the U.S. economy can avoid recession and can support global demand.

The New Zealand dollar fell 0.6 percent after the central bank cut interest rates by 50 basis points and sounded downbeat about the economic outlook, leaving the door open for more cuts.

MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.6 percent as shares in Hong Kong rebounded about 2 percent after posting their biggest drop since 2008 the day before.

Hong Kong markets fell on Tuesday, mainland shares were knocked off highs and commodities from oil to metals fell as a news conference by China’s National Development and Reform Commission gave no major stimulus details.

The CSI300 and blue-chips fell about 3% on Wednesday.

futures, which fell 4.6% overnight, settled at $77.79 a barrel. Iron ore found support at $106 in Singapore after falling 5% on Tuesday.

“The disappointment, while understandable, seems premature and misplaced,” Mizuho’s Asia ex-Japan macro research head Vishnu Varathan said in a note to clients.

“The truth is that it is not the NDRC’s place to provide details on fiscal stimulus (or an) additional monetary policy stimulus.”

rose 1 percent, with shares of grocer Seven & I Holdings rising after Bloomberg News reported that Canadian retailer Alimentation Couche-Tard would increase its takeover offer.

Soft landing

U.S. stock futures were broadly flat in Asia following solid gains in overnight cash trades as several Federal Reserve officials sounded positive on the prospect of managing interest rate levels for a soft economic landing.

Influential New York Fed President John Williams told the Financial Times that last week’s unexpectedly strong jobs report showed the economy was healthy, while falling inflation left room for rates to be cut in time.

Traders dismissed expectations that the Fed could cut rates again by 50 bps in November and currently price in about an 88% chance of a 25 bps cut.

Treasuries settled overnight following recent selling, leaving US two-year yields at 3.96% and 10-year yields at 4.01%.

The US dollar drew support from higher yields and rose to trade at $1.0968 per euro and was steady at 148.25 yen. The Australian dollar was slightly weaker at $0.6738 and traders saw the Reserve Bank of New Zealand as preparing for further cuts ahead.

At $0.6096, it was trading at a seven-week low and testing its 200-day moving average.

“Although today’s meeting did not provide updated forecasts and was not accompanied by a press conference, the forward guidance in the decision statement sounded harmonious, allowing the RBNZ the flexibility to cut rates again before the end of the year,” the IG analyst said Markets Tony Sycamore. .

Minutes from the Federal Reserve’s September meeting – at which US interest rates were cut by 50 bps – are announced later in the session, along with appearances from the Fed’s Raphael Bostic, Lorie Logan and Mary Daly.