Hong Kong Shares Surge to New Highs Amid Positive Economic Outlook

Hong Kong shares reached a three-year peak, leading Asian markets with optimism for China's economic prospects. The Hang Seng index rose by 2%, driven by positive Chinese data and supportive policies boosting consumption. The New Zealand dollar also rose, benefiting from China's consumption-driven demand.

Hong Kong's stock market soared to new heights not seen in the last three years, spearheading a rally across Asian markets on Tuesday as investors embraced a positive outlook for China's economy. The Hang Seng index climbed by 2% in morning trading, tallying a 23% increase this year, outperforming significant global markets.

The surge in stock markets came as traders rushed to adjust their positions, sending the New Zealand dollar to a three-month high. This behavior reflects the currency's sensitivity to Chinese consumer demand, primarily due to food exports. Meanwhile, the Australian dollar and China's yuan also showed strength.

China's economic performance continues to defy expectations amid transactional tensions, benefiting from U.S. policy changes under President Trump. China's recent announcements of childcare subsidies and a domestic consumption plan, alongside favorable trade statistics, have buoyed investor sentiment globally.

(With inputs from agencies.)