KGI Asia Commentary

HSI fell 256 points on Friday

The Hang Seng Index opened 175 points lower at 18,037 points on Friday, and fell 256 points, or 1.4%, to 17,956 points at market close. The China Enterprises Index fell 92 points, or 1.5%, to 6,175 points. The Hang Seng Technology Index fell 99 points, or 2.4%, to 4,059 points. The market turnover was HK$ 81.3 bn. ENN Energy (2688) announced its semi-annual results, turnover fell 7%, share price fell 16%. Netease (9999) quarterly revenue from games and related value-added services declined in the second quarter, and its stock price fell 6.7% throughout the day. AAC Technologies (2018) continued its downtrend, falling another 3.5%.

University of Michigan consumer confidence index falls

U.S. stocks closed up on Friday, with the Dow Jones up 247 points, or 0.73%, to 34,347 point. The Nasdaq up 127 points, or 0.94%, to 13,590 point. The S&P 500 up 29 points, or 0.67 %, to 4,406 points. The Dow fell 0.45% last week, its second straight weekly loss. The Nasdaq rose 2.26 percent and the S&P 500 rose 0.82 percent, both rebounding after three straight weeks of losses.

In terms of economic data, the final value of the University of Michigan consumer confidence index in August in the United States was 69.5, slightly lower than the initial value of 71.2. Joanne Hsu, director of consumer surveys at the University of Michigan, said consumer confidence fell slightly in August after a sharp rise over the past few months. The long-term economic outlook fell about 12 percent this month, but remains higher than it was two months ago, despite improvements in purchases of durable goods and expectations for living conditions. Consumers weighed a combination of positive and negative factors in the economy, which resulted in different offsetting trends for different demographic groups. Consumers believe the economy's rapid upturn over the past three months has slowed, especially on inflation, and they are skeptical about the outlook ahead.

Powell said that if appropriate, interest rates may be further raised to suppress inflation

Markets are focused on a speech by Fed Chairman Jerome Powell at the Jackson Hole Economic Symposium. At the meeting, Powell pointed out that the economic growth rate is faster than the Fed's expectations, but the 2% inflation target is still too high, saying that there is still a long way to go to fight inflation. At the same time, he said in the meeting that he will cautiously decide whether to raise interest rates again in the future. Restraining policies, such as preparing to further raise interest rates, may be adopted until inflation met the target.

Hong Kong Stock Connect had a net inflow of 3.386 billion yuan on Friday, of which Meituan (3690) had the largest inflow of HK$1.18 billion; followed by South Hang Seng Technology (3033). Kuaishou (1024) recorded the largest net outflow of HK$193 million; followed by Tencent (700).