KGI Asia Commentary
HSI fell 398 points on Tuesday
The Hang Seng Index fell 398 points or 2.1% to 19,015 on Tuesday. HSTECH fell 99 points or 2.4% to 4,129 and HSCEI fell 158 points or 2.4% to 6,400. Daily market turnover was HK$95.0bn.
Dow rises more than 300 points, 7th straight day of gains
U.S. stocks rose on Tuesday, with investors encouraged by better-than-expected quarterly results from a number of big companies, including banks, and optimism about artificial intelligence that also supported Microsoft shares to hit new highs. The Dow Jones Industrial Average rose 366 points, or 1.1%, the Nasdaq rose 0.8% and the S&P 500 rose 0.7% to close at a 52-week high. Bank of America led the gains in bank stocks, up more than 4 percent, after reporting second-quarter earnings that beat analysts' expectations as higher interest rates boosted loan income. Meanwhile, shares of Morgan Stanley rose 6 percent after the company reported second-quarter revenue and net profit that topped estimates, as performance in its wealth management business offset weakness in trading due to lower equities and fixed-income revenue. Charles Schwab rose more than 12%, making it the biggest gainer after reporting better-than-expected quarterly results. Microsoft shares rose 4% as investors piled into the stock on optimism about artificial intelligence. The tech giant said it would charge businesses $30 per user to access the tech giant's suite of artificial intelligence tools. After markets close on Wednesday, Tesla Inc and Netflix are due to report quarterly results. For Tesla's quarterly results, investors' focus is likely to be on the electric carmaker's profit margins after recent price cuts, while investors' focus on quarterly results is likely to focus on rising user numbers and the streaming giant's crackdown on password sharing. on the guidelines. Overall, earnings season is off to a strong start. Of the S&P 500 companies that have reported, 84% beat profit expectations, according to FactSet.
U.S. retail sales rise modestly Retail sales rose 0.2% last month, missing expectations for a 0.5% rise. The May figure was revised up to a 0.5% increase from the previous 0.3%. Overall, the report from the Commerce Department on Tuesday was mixed, reflecting resilience among consumers, though spending growth slowed. That did not change expectations for the Fed to resume raising rates this month after leaving rates unchanged in June.
Hong Kong Stock Connect had a net inflow of HK$1.17bn on Tuesday, of which XPeng (9868) had the largest net inflow, reaching HK$0.22bn; followed by China Mobile (941). Tencent (700) recorded the largest net outflow at HK$1.45bn, followed by SMIC (981).
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