KGI Asia Commentary
HSI fell 6 points on Wednesday
The Hang Seng Index fell 6 points or 0.0% to 18,449 on Wednesday. HSTECH fell 16 points or 0.4% to 4,176 and HSCEI rose 6 points or 0.1% to 6,403. Daily market turnover was HK$92.9bn.
Dow ends lower, dragged down by Apple shares
The Dow ended lower on Wednesday as stronger-than-expected services sector data stoked concerns that inflation remains sticky, meaning interest rates could stay higher for longer. Meanwhile, the market was also dragged down by Apple's share price. The Dow Jones Industrial Average fell 0.6%, or 197 points, the Nasdaq fell 1.1%, and the S&P 500 fell 0.7%. U.S. services sector activity rose more than expected in August, rising to 54.5 from 52.7, while the price index sub-index that measures inflation rose to 58.9 from 56.8, as strong demand for labor continued to underpin wage growth. Apple shares fell more than 3%, leading decliners in technology stocks, after a report that China, a key market for Apple, has ordered government agency employees not to use foreign devices, including Apple iPhones. Roku raised its third-quarter financial forecast after announcing further cost-cutting plans, including about 10% of its workforce and consolidating office space. Shares of the company closed up nearly 3%. The streaming device company raised its third-quarter revenue forecast by 7% to a range of $835 million to $875 million, up from $815 million previously.
Fed's Beige Book shows slowing growth in economic activity
The Federal Reserve said in its Beige Book survey that growth in the U.S. economy and job market slowed in July and August, with many companies expecting a general slowdown in wage gains in the near future. “Contacts from most districts indicated economic growth was modest,” the Fed said in a report on Wednesday. The Beige Book is based on information collected by the Fed's 12 regional banks and compiled by the Kansas City Fed based on information collected on or before August 28.
Hong Kong Stock Connect had a net inflow of HK$4.16bn on Wednesday, of which Sunac (1918) had the largest net inflow, reaching HK$0.54bn; followed by CNOOC (883). Tencent (700) recorded the largest net outflow at HK$0.18bn, followed by PetroChina (857).
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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