KGI Asia Commentary
Hang Seng Index fell 350 points on Tuesday
The Hang Seng Index fell 350 points or 2.16% to 15,866 on Tuesday. HSTECH fell 78 points or 2.3% to 3,326 and HSCEI fell 103 points or 1.9% to 5,343. Daily market turnover was HK$84.4bn.
On Tuesday, Dow closes more than 200 points lower after the 10-year U.S. Treasury yield exceeded 4%
The Dow closed lower on Tuesday as investors digested a raft of earnings reports and a jump in U.S. Treasury yields. The Dow Jones index fell 231.86 points, or 0.62%, to close at 37,361.12 points. The S&P 500 fell 0.37% to close at 4,765.98 points, and the Nasdaq fell 0.19% to close at 14,944.35 points. Boeing shares fell about 7.9% after Wells Fargo downgraded the company from overweight to wait-and-see as problems with the Boeing 737 Max 9 model persisted. Meanwhile, AMD shares rose 8.3% on upbeat analysts' comments on semiconductor demand. The chipmaker is trying to catch up with Nvidia in the artificial intelligence race, with shares rising to a new 52-week high ahead of reporting quarterly results on January 30. Goldman Sachs rose nearly 1% after reporting better-than-expected fourth-quarter results, as equity sales and trading helped offset weakness at the Wall Street giant's core investment banking unit. Morgan Stanley reported mixed fourth-quarter results, with earnings falling short of analysts' expectations. The company's shares fell 4.2%.
Fed Chairman Waller says there is no rush to cut interest rates
The U.S. 10-year Treasury yield climbed more than 11 basis points to above 4% after Federal Reserve Governor Christopher Waller said in a speech that the central bank may ease monetary policy more slowly than Wall Street expected. As long as the labor market and economic activity are solid, Waller said, “I see no reason to move as quickly or cut as rapidly” as in previous rate-cutting cycles. “When the time is right to begin lowering rates, I believe it can and should be lowered methodically and carefully.”
Hong Kong Stock Connect had a net inflow of HK$2.94bn on Tuesday, of which China Mobile (941) had the largest net inflow, reaching HK$0.46bn; followed by Wuxi Bio (2269). Hkex (388) recorded the largest net outflow at HK$0.17bn, followed by Li Auto (2015).
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