Australian Rate Decision, Oil and Currencies

SINGAPORE — Stocks in Asia-Pacific fell mostly on Tuesday as Australia raised its interest rate for the first time in more than a decade.

Australia’s S&P/ASX 200 fell 0.42% to close at 7,316.20 and the Australian dollar last fell to $0.7090, having jumped to levels around $0.7121 following the rally.

Australia’s central bank said on Tuesday that the cash rate will be increased by 25 basis points to 0.35%, the first rate hike since November 2010.

The increase was larger than analysts’ estimate of 15 basis points to 0.25%, according to the median forecast in a Reuters survey of 32 economists.

Elsewhere, Hong Kong’s Hang Seng Index was down 0.1% in the last trading hour. Alibaba shares earlier fell more than 9%, before the latest trimmed losses fell 1.37%.

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Shares had fallen following unconfirmed rumors linking company founder Jack Ma to a national security investigation. Chinese state media reported that the Hangzhou security bureau took “criminal coercive measures” against an individual surnamed Ma on suspicion of using the Internet to endanger national security on April 25.

CNBC was unable to confirm the Chinese report. Alibaba and the Jack Ma Foundation did not immediately respond to a request for comment.

Shares of British bank HSBC in Hong Kong rose 2% in the afternoon. On Friday, Reuters reported that HSBC’s main shareholder, Chinese insurance giant Ping An, had called for the bank to be dissolved.

Ronald Wan, non-executive chairman of Partners Financial Holdings, told CNBC’s “Street Signs Asia” on Tuesday: “When we look at this issue, we also need to add some kind of political element.”

“Definitely the Hong Kong operation can operate independently…separate from other parts of the operation. I think it can follow the government’s instructions…more correctly,” Wan said. “For global investors, I think they have to make a decision as to whether they should accept this … separation or spin-off.”

In South Korea, the Kospi fell 0.26% to finish at 2,680.46. MSCI’s broader index of Asia-Pacific shares outside of Japan fell 0.32%.

Several markets are closed in the region for the holidays, including China, Japan, Singapore and India. Hong Kong will resume trading after a holiday on Monday.

In Europe, stocks in the region fell sharply on Monday, buoyed by a brief drop in Swedish markets. It was caused by a single Citigroup sell order trade, allegedly linked to a miscalculation involving a Nasdaq index involving Swedish stocks.

In US stocks, the S&P 500 and the Nasdaq Composite hit new lows for the year before closing in positive territory for the day.

The Nasdaq Composite rose 1.63% to 12,536.02, while the S&P 500 rose 0.57% to 4,155.38. The Dow Jones Industrial Average gained 84.29 points, or 0.26%, to close at 33,061.50. The Dow Jones Industrial Average fell more than 500 points to its session low.

The yield on the benchmark 10-year US Treasury note rose around 11 basis points to 2.994% on Monday, hitting a high of 3.01% during the session, the highest since Dec. 3, 2018.

Financial markets expect the US central bank to announce a half percentage point increase in the Fed’s benchmark interest rate on Wednesday.

foreign exchange and oil

The US Dollar Index, which tracks the greenback against a basket of its peers, was at 103.626, up from levels around 103.4 previously.

The Japanese yen was trading at 130.23 to the dollar as it held below 129.

Oil prices fell in afternoon Asian trading hours, with international benchmark Brent crude futures down 0.87% at $106.61 a barrel. US crude futures lost 0.85% to trade at $104.26 a barrel.

— CNBC’s Evelyn Cheng contributed to this report.

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