FX.co ★ Fed Cut Bets and AI Optimism Bring Hang Seng to 4-Year High

On Wednesday, the Hang Seng Index climbed 262 points, or 1%, to close at 26,200. This marks its fourth consecutive session of gains, reaching a four-year high with strong performance across all sectors. This upward momentum mirrored the positive trend on Wall Street, fueled by increasing expectations that the U.S. Federal Reserve will announce an interest rate cut of at least 25 basis points next week, spurred by recent signs of labor market weakness. The forthcoming release of inflation data is anticipated to offer further insights.

In China, consumer price indices fell at the fastest pace in six months in August, renewing hopes for potential government intervention that might enhance consumer goods turnover. Meanwhile, producer price deflation hit a four-month low, suggesting that Beijing's measures to mitigate corporate price competition are proving effective. Propelled by a bilateral currency swap agreement between China and Europe, property and financial sectors particularly outperformed. Technology stocks also rallied, lifted by positive sentiment around artificial intelligence revenue prospects following robust results from Oracle in the U.S.

Notably, Alibaba shares rose by 0.6%, driven by favorable outlook sentiments. Baidu Hong Kong saw an impressive gain of 2.6% after launching an upgraded AI model. Conversely, Laekna Inc. experienced a significant drop of 12.7%, primarily due to a share sale at a discounted rate.