Asian stock markets rose on Wednesday after the gains of Wall Street overnight. However, as the tension in the financial center continues to brew, the Hong Kong market is somewhat shaken. Nikkei 225 (N225) of Japan rose 1.4% in initial trading, while Kospi (KOSPI) of South Korea climbed 0.4%. On Wednesday, the central bank of South Korea lowered its key interest rate to 1.25% by 25 basis points. The bank cut interest rates for the first time in three years in July. Shanghai Composite Index (SHCOMP) of China gained 0.4%. Also, Hang Seng Index (HSI) of Hong Kong was up around 0.4%, though it slipped slightly by 0.3% in the earlier trading.
The Chinese Foreign Ministry said on Wednesday that if US lawmakers approve the bill to support the protests in Hong Kong, they will retaliate. Since the US House of Representatives voted to pass a bill, the government issued the statement. This will require an annual review to conclude whether the autonomy of Hong Kong from the mainland government of China remains sufficient to prove the city’s special treatment received under US law. An explicit condemnation was issued to Beijing on Tuesday afternoon to the House of Representatives and reiterated US support for Hong Kong’s democracy activists, as police have increased their pressure on semi-autonomous protesters in recent weeks. Legislators approved the Hong Kong Human Rights and Democracy Act as seven million demonstrators took to the streets earlier this week and urged the US Congress to favor the measure. The bill was regarded as a non-controversial measure because of the broad support of the two parties, but it was passed by voice vote because it did not require a recorded vote.
The Legislation’s Senate version is yet expecting a floor vote. It is also slightly different from the measures in the House of Representatives, which means that the House may have to deal with the issue again later. US stock market futures fell slightly during Asian trading hours. The S&P 500 (SPX), the Dow Jones Industrial Average (INDU), and the Nasdaq (COMP) dropped about 0.2%. On Tuesday, all three indexes closed sharply higher.