KGI Asia Commentary
Hang Seng Index rose 418 points on Thursday
The Hang Seng rose 418 points, or 2.5%, to 17,043; the H-Share Index rose by 161 points, or 2.9%, to 5,765; the Hang Seng Technology Index rose by 124 points, or 3.4%, reported 3,764. The market's total daily turnover was HK$109.9 billion. EV stocks performed well today, with the share prices of Geely (175) and BYD (1211) rising 6.7% and 4.1% respectively. In addition, today Xiaomi (1810) released photos of its first car "SU7" on social platforms. However, Xiaomi's car technology conference held today will only focus on technical descriptions. The launch time and price of the car have not yet been announced. Xiaomi (1810) shares fell 0.2%.
U.S. mortgage rates hit new lows in May
After the Federal Reserve stated that the rate cut was under their schedule next year, mortgage rate had dropped significantly from a high of more than 8%. Freddie Mac said in a statement on Thursday that the average interest rate on a 30-year fixed loan was 6.61%, down from 6.67% last week and the lowest since May this year. The downward interest rate and the economy downturn not as serious as expected, we believe this will continue to stimulate demand for home purchases. However, the U.S. existing home contracted sales index remained unchanged at 71.6 in November, the lowest level since data were recorded in 2001. The local second-hand housing market is suffering from a lack of inventory, which may keep housing prices high and housing inflation may be difficult to come down.
The performance of the three major U.S. stock indexes have mixed. The DJIA rose 53 points, or 0.14%, to close at 37,710; the S&P 500 rose 1 point, or 0.04%, to 4,783; and the Nasdaq composite fell 4 points, or 0.03%, to 15,095.
Maersk cargo ships return to Suez Canal route
The market's risk of the Houthi armed group disrupting global trade may begin to recede. Shipping giant Maersk will now sail container ships between Europe and Asia through the Suez Canal instead of going around the Cape of Good Hope in Africa. The return of routes to normal conditions is expected to help reducing freight time. For the risk premium of freight, especially oil tankers, is expected to fall as well, which will greatly reduce the inflationary pressure from energy in December.
The net outflow of Hong Kong Stock Connect recorded a net outflow of HK$1.97bn on Thursday, of which Tencent (0700) had the largest net inflow, reaching HK$540mn, followed by Meituan (3690); Tracker Fund (2800) recorded the largest net outflow, reaching HK$1.92 billion. Followed by CSOP HS TECH (3033).
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.
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