Asian equities moved up on Wednesday as investors clung to optimism that the pace of US and global rate rises will moderate, but US futures fell following poor reports from tech juggernauts Alphabet and Microsoft.

E-mini futures for the S&P 500 dropped 1% in early trade after Alphabet, which owns Google, reported lower-than-expected ad revenues after the bell and Microsoft missed revenue expectations, both of which might be early signals of a slowdown in the US economy.

Meanwhile, MSCI’s broadest index of Asia-Pacific stocks outside Japan jumped 1%, powered by a rebound in Hong Kong, while Japan’s Nikkei rose 1.1% at midday.

The mainland Chinese benchmark index jumped 1%, while Hong Kong stocks rose 2%, aiming to recover from Monday’s sharp sell-off in Chinese assets by global investors concerned about Beijing’s economic orientation.

Xi Jinping’s new leadership group has generated concerns that a more dominant Party leadership would prioritize the state over the private sector and maintain draconian zero-Covid measures long into next year.

On Tuesday, US economic statistics indicated slower home price rise and deteriorating consumer confidence, as well as some indicators that the Federal Reserve’s relentless interest rate hikes are beginning to chill the labor market.

Traders and analysts anticipate another 75 basis point (bps) hike from the Fed next Wednesday, but a slowdown to half a point in December is becoming more likely. Treasuries rose substantially overnight, with the yield on the benchmark 10-year US government note falling by more than 12 basis points. On Wednesday, it remained stable at 4.0937 percent.

In Australia, inflation accelerated to a 32-year high last quarter as the cost of home construction and gas increased. The unexpected increased pressure on the central bank to reverse its recent dovish stance, though markets do not expect a big move.

The Australian dollar received very minor and transitory support, remaining relatively stable at $0.6386. Three-year Australian government bond futures fell from their highs but held stable for the day at 96.400.

In currency markets, the dollar flirted with a three-week low against key rivals, while sterling clung to a six-week high as incoming British Prime Minister Rishi Sunak vowed to lead the country out of an economic crisis.

The pound was last trading at $1.1445, down 0.19 percent on the day but still close to Tuesday’s high of $1.1500, last reached on September 15.

The Japanese yen fell 0.30 percent against the US dollar to 148.39 per dollar. The battered currency hit a 32-year low of 151.94 on Friday but fell back following two rounds of apparent Bank of Japan intervention on either side of the weekend.

Japanese government bonds rose substantially after the Bank of Japan said that it will expand bond purchases. Oil prices dropped as industry data revealed that US crude oil stocks increased more than expected, fueling concerns about a worldwide recession that would reduce demand.

Brent oil futures for December fell $1.17, or 1.3%, to $92.35 a barrel at 0111 GMT, after rising 26 cents the day before. WTI oil futures for December delivery in the United States fell 88 cents, or 1%, to $84.44 a barrel.