China stocks rally on stimulus hopes, weak GDP growth hits Aussie

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Asian stocks held their ground on Wednesday as Chinese equities rallied on stimu...

TOKYO - Asian stocks held their ground on Wednesday as Chinese equities rallied on stimulus hopes, although a resurgence in regional tensions capped broader gains with North Korea opting to restore part of a missile test site it had began dismantling earlier.

The Shanghai Composite Index was up 1 percent, hovering near a nine-month high, as China’s state planner said the government will boost domestic consumption further this year. Beijing announced billions of dollars in tax cuts and infrastructure spending on Tuesday to reduce the risk of a sharper economic slowdown.

Robust U.S. economic data supported the dollar, but its Australian counterpart slid after data showed the economy slowed to a near standstill in the fourth quarter. Wall Street dipped on Tuesday as a drop in General Electric shares countered positive retailer earnings and investors eyed a key resistance level for the benchmark S&P 500 after the market’s run to a five-month peak on Monday. [.N]

“Steady U.S. growth is a stronger theme than slowing Chinese growth, especially with Sino-U.S. trade talks seemingly headed for some kind of a conclusion.” The dollar held gains after rising against its peers on Tuesday’s upbeat ISM non-manufacturing sector report.

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