What happened overnight – Friday 21st February 2025

Asian Markets Rally as Investors Return to Chinese Stocks; Gold Nears Record High

Asian shares soared to a three-month high as renewed investor confidence in Chinese stocks fueled a market rally, driven by optimism surrounding artificial intelligence.

Gold remained close to its record peak, poised to extend its winning streak to an eighth consecutive week. The precious metal benefited from safe-haven demand, spurred by concerns over Donald Trump’s tariff threats and ongoing tensions as the U.S. president pushes for a swift resolution to the Russia-Ukraine war.

MSCI’s broadest index of Asia-Pacific shares outside Japan climbed over 1% on Friday, reaching its highest level since November 8. The index is now on track for its longest winning streak in more than two years, with six consecutive weeks of gains.

The rally was largely fueled by a surge in Hong Kong and China-listed equities. The Hang Seng Index soared to a three-year high, while the CSI300 index advanced 1%. Hong Kong’s technology sector led the charge, with the Hang Seng Tech Index rising 4.7%, while the Shanghai Composite Index gained 0.7%.

Chinese stocks have been on a strong upward trajectory in recent days, spurred by DeepSeek’s breakthrough in artificial intelligence, which has reignited investor enthusiasm for the country’s tech sector.

So far this year, the Hang Seng Tech Index has surged nearly 30%, significantly outperforming the S&P 500, which has gained just 4% over the same period.

Meanwhile, Wall Street saw a downturn, with the Dow Jones Industrial Average declining 1% to 44,176.65. The S&P 500 slipped 0.4% to 6,117.52, while the Nasdaq Composite dropped 0.5% to 19,962.36.

In the bond market, the yield on the benchmark 10-year U.S. Treasury note edged down to 4.511% from 4.520% late Wednesday.