KGI Asia Commentary
HSI fell 373 points on Tuesday
The Hang Seng Index fell 373 points or 2.3% to 15,703 on Tuesday. HSTECH fell 104 points or 3.3% to 3,098 and HSCEI fell 133 points or 2.5% to 5,275. Daily market turnover was HK$94.8bn.
The S&P closed little changed on Tuesday as it awaits a Fed rate decision.
The S&P closed nearly flat on Tuesday as Wall Street awaited the Federal Reserve's latest interest rate decision. The index fell 0.06% to close at 4,924.97 points. The Dow Jones Industrial Average rose 133.86 points to close at 38,467.31 points, an increase of 0.35%. This is the seventh time this year that it has set a closing record. The Nasdaq fell 0.76% to close at 15,509.90 points. General Motors shares rose nearly 8% after reporting better-than-expected earnings. Microsoft's second-quarter earnings report on Tuesday exceeded analysts' expectations, as growing demand for artificial intelligence continues to support the growth of the technology giant's cloud computing business. Alphabet's fourth-quarter results exceeded Wall Street expectations, and its cloud business continued to strengthen, but the growth of its advertising business was slightly lower than expected. Alphabet shares fell 4% after hours on Tuesday. Advanced Micro Devices shares fell after the chipmaker reported disappointing revenue guidance. So far, 144 companies have reported quarterly results, accounting for about 29% of the index. About 79% of companies beat Wall Street estimates, compared with an average of 76% over the past four quarters. Meanwhile, oil prices rose on Tuesday as an upgrade to global economic growth forecasts and rising tensions in the Middle East offset concerns about demand from China. The International Monetary Fund has raised its forecast for global economic growth.
The labor market continues to show strength
The U.S. Department of Labor's latest Job Openings and Labor Turnover Survey showed that job openings climbed to 9.026 million in December, higher than economists' estimates of 8.75 million. In signs of continued strength in the job market, data showed consumer confidence jumped to a two-year high. The two reports showed a strengthening economy, pushing two-year Treasury yields higher as investors bet the data could support the Federal Reserve's policy of keeping interest rates high for an extended period.
Hong Kong Stock Connect had a net outflow of HK$0.86bn on Tuesday, of which WuxiBio (2269) had the largest net inflow, reaching HK$0.20bn; followed by Meituan (3690). Tracker Fund (2800) recorded the largest net outflow at HK$0.66bn, followed by Tencent (700).
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