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Why Did Asian Markets Regain Strength on April 20?

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Economic calendar

8:30 AM EST – US Philadelphia Fed Manufacturing Index (April)

8:30 AM EST – US Philadelphia Fed employment (April)

11:30 AM EST – Bank of England Governor Carney speaks

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China

After falling for four consecutive trading days, China’s Shanghai Composite Index regained strength on Thursday. The market sentiment was very weak in the first three trading days this week due to geopolitical tension between North Korea and the US. The market sentiment was also weaker due to tightening regulations on speculators in Chinese markets.

On April 20, selling pressure subsided and there was buying related to the new Xiongan economic zone. Tensions surrounding North Korea also eased to some extent on Thursday. The market had a chance to regain strength. On April 20, the Shanghai Composite Index rose 0.06% and ended the day at 3,172.59. The SPDR S&P China ETF (GXC) closed at 81.55—a fall of 0.13% on April 19.

Hong Kong

After falling to the lowest levels in a month on Wednesday, Hong Kong’s Hang Seng Index regained strength on April 20. The index reclaimed its 24,000 price level. The rally in the market was backed by a rise in the technology sector. The technology sector rose on Thursday with Tencent Holdings closing at all-time highs. AAC Technologies Holdings and Sunny Optical Technology rose to all-time highs and pushed the sector higher.

On April 20, the Hang Seng Index rose 0.97% and closed the day at 24,058.98. The iShares MSCI Hong Kong ETF (EWH) fell 0.81% to $22.11 on April 19.

Japan

After regaining some strength in the past three trading days, Japan’s Nikkei index closed almost flat on Thursday. Japan’s stronger-than-expected trade data supported the market. According to the Ministry of Finance, Japan’s exports and imports in March rose 12% and 15.8% year-over-year, respectively, by beating expectations. The trade balance increased to 615 billion yen—better than the expectation of 576 billion yen. Nikkei closed the day at 18,430.49—a fall of 0.01%. The iShares MSCI Japan (EWJ) closed at 5.96—a fall of 0.06% on April 19. In the next part, we’ll see how European markets are performing on Thursday.

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