KGI Asia Commentary
Hang Seng Index fell 57 points on Friday
The Hang Seng Index opened 85 points lower at 16,217 points, the market closed fell 57 points to 16,244 points; the H-Share Index fell 12 points, or 0.2%, to 5,482 points; the Hang Seng Technology Index fell 32 points, or 0.9%, to 3,470 points. The total daily turnover of the market was HK$69.5 billion. Bitcoin concept stocks fell back, with BC Technology (863) falling 25%. Shareholders of Meitu (1357) sold shares at a discount, and the stock price fell 12.5%.
U.S. December PPI lower than expected
U.S. stocks closed mixed on Friday. The Dow Jones index fell 118.04 points, or 0.31%, to 37592.98 points; the Nasdaq index fell 2.57 points, or 0.02%, to 14972.76 points; the S&P 500 index fell 3.59 points or 0.08%, reported at 4783.83 points. All three major stock indexes recorded gains this week, with the Dow rising 0.34% for the week, the Nasdaq rising 3.09%, and the S&P 500 rising 1.84%.
In terms of economic data, the United States released the producer price index on Friday. It rose 1% year-on-year in December, lower than market expectations of 1.3%, but slightly higher than the previous value of 0.9%; it fell 0.1% month-on-month, lower than market expectations of rising 0.1%. The PPI is a leading indicator to measure inflation. Different from the CPI released on Thursday, it can help cease the worries of inflation rebounds. Therefore, according to the FedWatch tool, the market expects the chance of an interest rate cut in March to slightly increase from 70.2% to 76.9%. %.
Pork prices continue to be a drag on China’s CPI
The National Bureau of Statistics announced on Friday that the Consumer Price Index (CPI) in December fell by 0.3% year-on-year, 0.2 percentage points narrower than the decline in November. It has recorded negative values for three consecutive months. The overall inflation in 2023 will be 0.2%. Changes in pork prices continued to be a drag in December last year. Pork prices fell by 26.1% year-on-year in December, causing overall inflation to drop 0.43 percentage points. Looking back, pork prices in 2023 have been relatively stable for most of the time, unlike the significant fluctuations in pig prices that began in the second half of 2022. Therefore, the base effect of pig prices in 2024 will be significantly reduced compared to 2023.
The net inflow of Hong Kong Stock Connect on Friday was HK$1.47 billion . Among them, China Mobile (941) had the largest inflow, reaching HK$175 million; followed by China Construction Bank (939). Tencent (700) recorded the largest net outflow of HK$216 million; followed by HSBC (0005).
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