KGI Asia Commentary
Hang Seng Index fell 318 points on Tuesday
The Hang Seng Index fell 318 points or 1.9% to 16,327 on Tuesday. HSTECH fell 77 points or 2.0% to 3,682 and HSCEI fell 93 points or 1.6% to 5,609. Daily market turnover was HK$118.0bn.
Dow closes lower, but tech strength keeps lid on losses
The Dow closed lower on Tuesday, but gains in technology stocks curbed downward momentum as U.S. Treasury yields fell after data showed labor demand fell to a two-year low. The Dow Jones index fell 79.88 points to close at 36124.56 points, a decrease of 0.22%. The S&P 500 fell slightly by 0.06% to 4,567.18 points. The Nasdaq rose 0.31% to close at 14,229.91 points, with technology stocks performing well. Shares of open source software development platform GitLab rose 11.5% after the company reported strong quarterly financial guidance. Nio shares rose 1.5% after the Chinese electric car maker reported a narrowing of losses in the third quarter. Apple's stock price rose 2%, and its market value exceeded US$3 trillion again. Bank of America quoted SensorTower data as saying that Apple's App Store revenue has increased by 11% so far this quarter. Shares of Take-Two Software fell 0.5% after the latest trailer for the company's best-selling video game "Grand Theft Auto" was released, suggesting that the game will be released in 2025, later than previously expected. Shares of CVS Health rose 3.7% as the company forecast higher-than-expected revenue in 2024 and unveiled a detailed plan to simplify prescription drug pricing. The company also raised its quarterly dividend by nearly 10%. Consumer products giant Procter & Gamble fell 3.5% after the company said it would record charges of up to $2.5 billion over the next two fiscal years related to writedowns on the value of its Gillette business and restructuring in certain markets. Bitcoin rose more than 4% after briefly rallying to $44,000, boosting most cryptocurrency-related stocks including Marathon Digital Holdings and Riot Platforms.
Slowing labor demand boosts rate cut bets; services activity improves
The JOLTS report shows that the number of job vacancies in the United States dropped significantly to 8.733 million in October from a downwardly revised 9.35 million in September, the lowest level in two years. Weak labor demand has pushed the U.S. 10-year Treasury yield below the key 4.2% level. Meanwhile, U.S. services sector activity unexpectedly rose last month, rising to 52.7 in November from 51.8 the previous month.
Hong Kong Stock Connect had a net inflow of HK$4.56bn on Wednesday, of which Tracker Fund (2800) had the largest net inflow, reaching HK$2.83bn; followed by HSCEI ETF (2828). HKEX (388) recorded the largest net outflow at HK$0.62bn, followed by Meituan (3690).
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