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Asian Stocks Mostly Lower After Australia Interest Rate Decision

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Asian stock markets were mostly down on Tuesday. Investors processed the Australian central bank’s decision to raise interest rates further to 0.85 percent. A month ago, interest rates in Australia were raised for the first time since November 2010 to combat high inflation in the country.

 

The All Ordinaries in Sydney fell 1.4 percent after the interest rate decision. Investors were shocked by the fact that interest rates had been raised by half a percentage point, while most economists had expected another rate hike by a quarter of a percentage point. This made it the largest rate hike since 2000. The central bank also hinted that it would raise interest rates further in the future.

The Nikkei in Tokyo held its own, closing 0.1 percent higher at 27,943.95 points. Japanese exporters benefited from a decline in the Japanese yen, which hit its lowest level against the US dollar in 20 years. A cheaper yen makes the products of Japanese companies abroad cheaper.

SoftBank added 1 percent. The Japanese tech investor benefited from the jump in the price of the Chinese taxi service Didi, in which the company has an interest. Didi rose in value on Wall Street by almost a quarter on Monday after a report from the business newspaper The Wall Street Journal that the Chinese authorities will complete their investigation into the taxi service this week and the taxi app may be returned to the app stores.

The other Chinese tech companies showed a mixed picture. Online shopping group Alibaba climbed more than 1 percent and internet and game company Tencent fell 1 percent in Hong Kong. Meal delivery company Meituan fell almost 2 percent after the recent sharp price gains that followed better-than-expected results from the company. The Hang Seng index in Hong Kong was down more than 1 percent in the meantime and the stock market in Shanghai lost a fraction.

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