Asian equities surged on Wednesday on expectations that
interest rate hikes by central banks around the globe will slow down, despite
disappointing results from tech behemoths Alphabet and Microsoft fueling fears
of a recession.

MSCI’s broadest index of Asia-Pacific shares outside Japan
rose 0.89%, led by an upturn in Hong Kong and China stocks, while Japan’s
Nikkei gained 1.2% to break through 27,500, its highest level since September
20.

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Eurostoxx 50 futures were lower by 0.20%, Germany’s DAX
futures were down 0.02%, and the FTSE futures were down 0.09%, while S&P
500 E-mini futures were down 1%, indicating a lower opening on Wall Street.

Microsoft missed revenue projections on Tuesday, while
Alphabet, which owns Google, reported lower-than-expected ad sales after the
closing bell, possibly adding to early indications of a slowdown in the US economy.

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Treasuries rose substantially overnight, with the yield on
the benchmark 10-year US government note falling by more than 12 basis points.
On Wednesday, it remained stable at 4.0837%.

The benchmark index for mainland China increased 1.6%,
while Hong Kong stocks increased 2% in an effort to continue the recovery from
Monday’s sharp sell-off of Chinese assets by foreign investors concerned about
Beijing’s policy path.

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On Tuesday, U.S. economic statistics indicated slower home
price rise and deteriorating consumer confidence, as well as some evidence that
the Fed’s relentless interest rate rises are starting to cool the labour
market.

In Australia, inflation accelerated to a 32-year high the
previous quarter as the cost of home construction and gas increased. The news
increased pressure on the central bank to reverse its recent dovish stance, though
markets do not expect a big move.

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The pound was last trading at $1.1458, down 0.08% on the
day but still close to Tuesday’s high of $1.1500, last reached on September 15.

The euro fell 0.13% to $0.9957 after reaching its highest
level since October 5 at $0.9995. When the European Central Bank meets on
Thursday, it is highly expected to raise interest rates by 75 basis points. The
Japanese yen fell 0.10% against the US dollar to 148.09 per dollar.

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Oil prices plummeted as industry data revealed that crude
oil reserves in the United States rose faster than predicted. Brent crude
futures for December slid 72 cents, or 0.8%, to $92.80 a barrel, after closing
26 cents higher the day before.