Hong Kong Equities Surge On China Rescue Headlines

Hong Kong equities have surged on headlines that the China authorities are considering a $278bn rescue package for the troubled asset class. China markets opened lower but are now back in positive territory.

• Bloomberg reported, "Policymakers are seeking to mobilize about 2 trillion yuan ($278 billion), mainly from the offshore accounts of Chinese state-owned enterprises, as part of a stabilization fund to buy shares onshore through the Hong Kong exchange link, said the people, asking not to be identified discussing a private matter." see this link for more details.
• This also follows reports late yesterday of Premier Li asking the authorities to take more forceful measures to stabilize the local stock market (see this link).
• The HSI is up close to 2.4%, just off session highs, the tech sub index is around +4.65% firmer.
• The spill over has been evident to FX markets. AUD is outperforming, up nearly 0.40%, close to 0.6600 handle. NZD/USD is up 0.2%, last near 0.6090. JPY is underperforming, last near 148.20. USD/CNH is back to 7.1850
• US equity futures are a touch higher, led by the Nasdaq.
• US Tsy futures are off session highs, but remain within recent ranges.