Daily Investment Strategy
Hang Seng Index closed on Monday
Monday was Hong Kong Labor Day Holiday and Hong Kong stock market was closed for the whole day.
More than half of S&P 500 companies reported 1Q23 earnings beat market
More than 50% S&P 500 companies have announced their 1Q23 quarter earnings, and the overall was performed well. Under those reported companies, 79% of them beat consensus, above the 10-year average of 73%. The level of EPS was higher 6.9% over the consensus, slightly higher than the past decade, but significantly lower than the five-year average of 8.4%. YoY EPS rose in 5 of the total 11 sectors, led by consumer discretionary and industrials. On the other hand, EPS fell YoY in six sectors, led by materials and healthcare. Finally, in terms of revenue, 74% of the companies are higher than consensus, and 2.1% YoY growth is higher than the 10-year average. For the 2Q23, analysts expect a -5.0% drop in earnings. For the 3Q23 and 4Q23, earnings are expected to rise 1.7% and 8.8%, respectively.
The three major US stock indexes first rose and then fell. The DJIA fell 46 points or 0.14% to close at 34,051; the Nasdaq fell 13 points or 0.11% to 12,212; the S&P 500 fell 1 point or 0.04% to close at 4,167.
China manufacturing PMI falls into contraction again in April
During the Labor Day holiday, the demand for tourism in China had a strong rebound. Referring to data from online platform, the number of ticket orders for tourist attractions has increased by more than 500% compared with 2019. However, manufacturing demand was affected by the decline in external demand, and China manufacturing PMI fell into contraction again. The April manufacturing PMI fell to 49.2, a four-month low and down from 51.9 in March. Such declining was higher than consensus. To analyse PMI’s main components, the manufacturing new orders, import orders, raw material inventory, and employment index were all below 50. The non-manufacturing PMI dropped from a high point to 56.4 from 58.2 last month, but it is still in the expansion stage.
Hong Kong Stock Connect was closed on Monday due to a public holiday.
Wen Kit Kenny is a SFC licensed person accredited to KGI Group to carry on regulated activities (for details, please refer to:https://apps.sfc.hk/publicregWeb/indi/AJF244/details). He and/or his associate do not have any financial interest in the recommended issuer or new listing applicant.
The materials contained herein are provided by KGI Asia Limited ("KGI") for information only. While such materials are based on or derived from sources believed to be reliable, KGI makes no representation or warranty (express or implied) as to their accuracy or reliability. Neither the information nor the opinions expressed herein constitute, or are to be construed as, an offer or invitation or solicitation of an offer to buy or sell any securities or investments. KGI and its officers, employees, agents and affiliates may have interests in the securities or investments covered herein and accept no liability whatsoever for any loss or consequence whatsoever (whether direct or indirect) resulting from any use of or reliance by you on such materials.
