People wait in line at night for a swab test at a COVID-19 testing site in Beijing on 20 November 2022. (Photo: Lintao Zhang/Getty Images) 
Japanese, South Korean and Australian equities benchmarks advanced while Chinese gauges fluctuated. US futures climbed after the S&P 500 closed at a two-month high on Wednesday before the Thanksgiving holiday.
The moves in Hong Kong and the mainland came as investors weighed the impact of record Covid-19 cases against signs of loosening monetary conditions. Official comments broadcast on Wednesday indicated the People’s Bank of China would allow banks to reduce capital reserves to stimulate growth.
China’s Covid-Zero policy has had “a significant effect on consumption” while the property crisis is “affecting investment in the sector and affecting property developers,” Gita Gopinath, first deputy managing director for the International Monetary Fund, said in an interview with Bloomberg Television.
Government bond yields edged lower in Australia and New Zealand after Treasury yields fell on Wednesday along with the dollar. A gauge of the greenback slid further on Thursday to levels not seen since August on a closing price basis. There will be no trading in Treasuries due to the US holiday.
Minutes from the Fed gathering earlier this month indicated several officials backed the need to moderate the pace of rate hikes, even as some underscored the need for a higher terminal rate.
This adds weight to expectations the central bank will raise rates by 50 basis points next month, ending a run of jumbo 75 basis point increases. Data on Wednesday also showed US business activity contracted and unemployment applications rose as the economy cools.
Oil fell as the European Union considered a higher-than-expected price cap on Russian crude and signs of a global slowdown increased.
Gold rose for a third day on the Fed minutes. The precious metal has been hurt by the US central bank’s aggressive monetary-tightening policy to curb inflation, which has pushed up bond yields and the dollar and in turn sent bullion tumbling about 16% from its March peak.
Bill Ackman, founder of hedge fund Pershing Square Capital Management LP, said he’s betting against the Hong Kong dollar and its peg with the greenback.
Pershing owns a “large notional position” in Hong Kong dollar put options – bearish wagers on the currency – he said in a tweet, adding that the peg no longer made sense for Hong Kong.
The won and three-year bond futures rose after the Bank of Korea raised its benchmark interest rate by 25 basis points. The increase, which was expected, is a pivot away from bigger hikes. BM/DM