BUSINESS

Asian markets rebound amid bargain-hunting in Hong Kong’s technology sector.

Kong (AFP) – Tech giants in Hong Kong led a rebound in the city after a recent sell-off. Oil prices rose above $100, but they’re still under pressure from fears about Chinese demand.

The gains are good, but more volatility is expected as Russia fights in Ukraine and the Federal Reserve starts raising interest rates to fight inflation.

Recently, trading displays have been dominated by red as investors are concerned about the conflict in eastern Europe, the price surge, and a COVID epidemic in China that has forced the closure of numerous towns, including the critical technology centre of Shenzhen.

Over the course of three days, Hong Kong’s Hang Seng Index lost more than 10%. Panicked investors sold off internet companies like Alibaba, JD.com and Tencent because they were afraid.

Fears of regulatory crackdowns by both Beijing and US authorities have hit the industry hard. There are also growing fears that China could be punished by the US if it helped Russia fight Ukraine.

The news that Shenzhen, southern China’s technology powerhouse, had been placed under lockdown to combat a Covid epidemic exacerbated the problem.

Some of Hong Kong’s losses were erased on Wednesday, when the Hang Seng Technology Index rose more than 6%. At one point, the Hang Seng Technology Index surged more than 3%.

JD.com surged 14%, while Alibaba and Tencent both gained more than 6%. NetEase, XD Inc, and Meituan also saw significant growth.

And the rest of Asia followed suit, mirroring Wall Street’s dip-buying rise.

Tokyo and Singapore both increased by more than 1%, while Shanghai, Sydney, Seoul, Wellington, Taipei, and Jakarta all increased as well.

A sharp drop in oil prices, which came just a week after they hit 14-year highs, has helped people feel better about the economy.

Both major futures dipped below $100 on Tuesday as anxieties about the Chinese economy and demand grew in the world’s largest importer of the commodity.

Hopes for a nuclear deal with Iran have made prices go down, as have signs that Russia and Ukraine aren’t making progress in their peace talks.

On the other hand, crude saw renewed buying optimism Wednesday, with Brent returning to triple digits on predictions that sanctions on Russia would keep supply tight even if the conflict is resolved shortly.

The rise in crude oil prices, as well as other commodities like wheat and metals, has created complications for central banks as they attempt to transition away from pandemic-era monetary policy and contain inflation.

And the Federal Reserve’s meeting, which ends later Wednesday, is under the spotlight as the central bank prepares for what is likely to be a series of rate rises this year.

Markets already know that the rate will rise, but they will pay attention to what Fed Chairman Jerome Powell says afterward because of the Ukraine crisis and the possible slowdown in economic growth.

Meanwhile, studies indicate that consumer prices in the United States are increasing at the fastest rate in 40 years.

“The convergence of events building up to this meeting puts policymakers in a very difficult position,” Nomura Securities International analyst Matt Rowe told Bloomberg Television.

Is it being disputed openly whether inducing a recession in order to get the figure down to 2% is a policy error?” He continued, referring to inflation.

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