KGI Asia Commentary
HSI fell 415 points on Tuesday
The Hang Seng Index fell 415 points or 2.1% to 19,220 on Tuesday. HSTECH fell 154 points or 3.7% to 3,980 and HSCEI fell 144 points or 2.1% to 6,820. Daily market turnover was HK$150.5bn.
S&P 500, Nasdaq closed at a record high ahead of Nvidia earnings
The S&P 500 and Nasdaq closed at record highs on Tuesday, ahead of Nvidia's earnings report on Wednesday. The Nasdaq rose 0.22% to 16,832.62 points. The S&P 500 rose 0.25% to 5,321.41. The Dow Jones Industrial Average closed up 0.17% at 39,872.99 points. Nvidia shares rose 0.6% ahead of its earnings report after the close on Wednesday. Analysts expect the semiconductor giant to post another set of strong results. Tech stocks rose after struggling to find direction earlier in the day as investors continued to weigh quarterly earnings ahead of the results. Palo Alto Networks shares fell nearly 4% as analysts pointed out that the cybersecurity company's latest revenue guidance was inconsistent with higher expectations. Nvidia shares ended slightly higher as the artificial intelligence leader prepares to report results that many expect will beat expectations. Microsoft shares rose nearly 1% on Tuesday ahead of the event, with many on Wall Street eagerly awaiting the company's latest artificial intelligence developments. Retail also took center stage on Tuesday as Lowe's and Macy's reported earnings. Macy's shares rose 5% after the department store chain raised its adjusted full-year earnings per share forecast as a turnaround plan unveiled in February began to take effect. Home improvement retailer Lowe's shares fell nearly 3% on Tuesday after it reported a drop in quarterly sales as inflation-hit Americans cut back on big discretionary home improvement projects. AutoZone shares fell 3% after the auto parts supplier reported domestic same-store sales for the quarter were flat compared with the same period last year. Ethereum continued its gains on Tuesday, rising more than 8%, on growing hopes that the U.S. Securities and Exchange Commission (SEC) may make a decision this week on the application for a spot ether exchange-traded fund.
Amid interest rate uncertainty, markets await more Fed clues
Federal Reserve Governor Christopher Waller continued to echo recent comments from a Fed spokesman about keeping interest rates unchanged at current levels, saying further evidence is needed that inflation is slowing before supporting a rate cut. “In the absence of a significant weakening in the labor market, I need to see several more months of good inflation data before I would be comfortable supporting an easing in the stance of monetary policy," Waller said Tuesday.
Hong Kong Stock Connect had a net inflow of HK0.47bn on Tuesday, of which BOC (3988) had the largest net inflow, reaching HK$1.14bn; followed by Li Auto (2015). Tracker Fund (2800) recorded the largest net outflow at HK$1.8bn, followed by Meituan (3690).
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