Japan’s Nikkei Stock Average JP:NIK +1.08% jumped 1.3%, South Korea’s Kospi KR:0100 +0.07% advanced 0.4%, and Australia’s S&P/ASX 200 index AU:XJO +1.44% rose 1.2%.
Hong Kong’s Hang Seng Index HK:HSI -0.36% rose 0.7%, and the Shanghai Composite Index CN:000001 +0.27% advanced 0.9%.
“Basically, we have come back to the scenario where the market is driven by liquidity,” said Ben Kwong, chief operating officer at KGI Asia.
Kwong said that last weekend’s move by the People’s Bank of China to reduce the amount of funds that major banks must keep in reserve to 20.5%, from 21%, meant that around 400 billion yuan ($63.5 billion) was injected into the Chinese banking system and allowed stocks to continue their recent, liquidity-fueled run.
