KGI Asia Commentary
Hang Seng Index fell 20 points on Tuesday
The Hang Seng Index fell 20 points or 0.1% to 17,915 on Tuesday. HSTECH fell 12 points or 0.3% to 3,697 and HSCEI fell 5 points or 0.1% to 6,368. Daily market turnover was HK$92.3bn.
S&P 500 hits another all-time high
The S&P 500 hit another record high on Tuesday as gains in Nvidia shares, which overtook Microsoft as the most valuable company, pushed technology stocks higher overall and overshadowed economic data that showed U.S. consumers were more cautious. The S&P 500 rose 0.3% to close at a new high of 5,487.97, having hit an intraday record of 5,490.74 earlier in the day. The Nasdaq rose 0.02% and the Dow Jones Industrial Average rose 56 points, or 0.2%. NVIDIA Corporation's stock price rose more than 3%, and its market value rose to US$3.34 trillion, surpassing Microsoft's US$3.31 trillion to become the company with the highest market value. Ahead of Nvidia's latest surge, Rosenblatt Securities raised its price target to $200 per share from $140, which would represent a nearly 50% upside from current prices. Elsewhere, shares in education technology group Chegg rose 3% after the company announced plans to cut 23% of its global workforce as part of a broader restructuring plan. Lennar shares fell nearly 5% after the homebuilder reported lower-than-expected home deliveries in the third quarter. It's a sign that demand for new homes is expected to remain subdued as mortgage rates hover at 20-year highs. GameStop shares fell 2%, extending sharp losses in the previous session, after Chief Executive Ryan Cohen told investors the company plans to operate a smaller network of stores.
Retail sales weaken
U.S. retail sales increased by 0.1% in May from the previous quarter. The growth rate was lower than expected and improved from the downwardly revised decrease of 0.2% in April. Economists had forecast retail sales, which mainly reflect the condition of goods and are not adjusted for inflation, to grow 0.3%. Weak retail sales data could affect the overall economic outlook and, in turn, the Fed's decision.
Hong Kong Stock Connect had a net inflow of HK5.86bn on Tuesday, of which CCB (939) had the largest net inflow, reaching HK$0.54bn; followed by Zijin (2899). Tencent (700) recorded the largest net outflow at HK$0.27bn, followed by Meituan (3690).
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