KGI Asia Commentary
HSI rose 353 points on Tuesday
The Hang Seng Index rose 353 points or 1.9% to 18,484 on Tuesday. HSTECH rose 106 points or 2.6% to 4,234 and HSCEI rose 140 points or 2.3% to 6,386. Daily market turnover was HK$101.3bn.
Dow ends higher as weak economic data prompts Fed to pause bets
The Dow ended higher on Tuesday and U.S. Treasury yields slipped as weak economic data stoked optimism that the Federal Reserve may not raise interest rates in September. The Dow Jones Industrial Average rose 0.9%, or 292 points, the Nasdaq rose 1.7%, and the S&P 500 rose 1.5%. Big tech stocks were in up mode as falling U.S. Treasury yields pushed the broader market higher. Falling U.S. Treasury yields have made higher growth stocks such as technology and consumer stocks more attractive. Gains were led by Meta Platforms Inc. and Alphabet, which is hosting a three-day cloud event and unveiled plans to integrate artificial intelligence more deeply into its cloud offerings. Apple shares rose more than 2% after announcing that it will release the iPhone 15 on Sept. 12. NIO posted a bigger-than-expected loss, sending its shares down 1%. However, the Chinese electric carmaker said it expected to deliver 55,000 to 57,000 vehicles in the quarter, above the forecast of 50,000. The U.S. court overturned the SEC's veto, allowing Grayscale Investments to issue the first Bitcoin exchange-traded fund (ETF), driving encryption-related stocks to be pushed up by the surge in Bitcoin.
The latest weaker- than- expected U.S. economic data led to a pullback in bond yields
The Conference Board's index of consumer confidence fell to 106.1 in August from 114 in July, missing economists' expectations of 116. The Labor Department's latest Job Openings and Labor Turnover Survey (JOLTs) report showed job openings fell to about 8.82 million in July, below expectations of 9.46 million. JOLTs is a measure of labor demand. U.S. bond yields fell as the latest economic data showed a surprise drop in consumer confidence and a surprise drop in job openings, boosting bets that the Federal Reserve could hold interest rates steady in September.
Hong Kong Stock Connect had a net inflow of HK$2.9bn on Tuesday, of which XPeng (9868) had the largest net inflow, reaching HK$0.38bn; followed by CNOOC (883). China Mobile (941) recorded the largest net outflow at HK$0.17bn, followed by Easy Buy (1797).
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