Asian shares inched up on Wednesday, as Chinese stocks extended their recovery to hit eight-week highs on receding fears about the trade war as well as hopes China’s weighting in the global benchmark will be increased.
Other markets were more subdued as U.S. bond yields edged near a seven-year peak ahead of a widely expected rate hike by the Federal Reserve and as international oil prices rose to four-year highs.
MSCI’s broadest index of Asia-Pacific shares outside Japan gained 0.4 percent. Shanghai shares rose 1.5 percent.
Global index provider MSCI said it will consider quadrupling the weighting of Chinese big-caps in its global benchmarks and also proposed adding mid-caps and shares listed on Shenzhen’s start-up board ChiNext.
The news further improved the mood of the market, where fears about the trade war have been offset by hopes Beijing’s stimulus could help the economy weather the impact of U.S. tariffs.
In Japan, the Nikkei was almost flat.
Wall Street shares were mixed overnight, as rises in energy shares on higher oil prices and gains in consumer discretionary shares following strong U.S. consumer confidence were offset by falls in many other sectors.
U.S. consumer confidence hit an 18-year high, adding to a string of recent U.S. data that pointed to the strong U.S. economic momentum, despite concerns about trade wars U.S. President Donald Trump is waging.
The Dow Jones Industrial Average fell 0.26 percent, the S&P 500 lost 0.13 percent while the Nasdaq Composite added 0.18 percent.
The utility sector, sometimes seen as an alternative to bonds because of the relative steadiness of their business, was the worst performer as investors braced for a rate hike by the Federal Reserve later on Wednesday.