KGI Asia Commentary
HSI rose 174 points on Monday
The Hang Seng Index rose 174 points or 1.0% to 18,130 on Monday. HSTECH rose 68 points or 1.7% to 4,127 and HSCEI rose 70 points or 1.1% to 6,246. Daily market turnover was HK$101.0bn.
Dow ends higher, 3M leads ahead of slew of economic data
The Dow ended higher on Monday, led by the industrial index led by 3M ahead of a flurry of data this week that will influence the Federal Reserve's policy decision next month. The Dow Jones Industrial Average rose 213.08 points, or 0.62%, to end at 34,559.98. The S&P 500 rose 0.63% to 4,433.31 and the Nasdaq Composite gained 0.84% to close at 13,705. Meta and Apple shares edged higher, while Nvidia shares rose 1.8%. Shares of electric car giant Tesla edged up 0.1%. 3M is close to reaching a $5.5 billion settlement to settle more than 300 lawsuits alleging the company sold defective earplugs to the U.S. military, with 3M closing more than 5%. Bloomberg reported, citing people familiar with the matter. The report also said the settlement shielded the company from greater liability, as some financial experts estimate that if the lawsuit is successful, it would result in losses of about $10 billion. Meanwhile, General Electric Holdings also boosted industrials, rising nearly 4%, as the maker of backup generators is expected to face a continued surge in demand from extreme weather. Meanwhile, Boston Scientific reported results from a clinical trial of its pulsed-field ablation system, which removes heart tissue that causes abnormal heartbeats, to treat patients with atrial fibrillation, sending shares up 6%. The clinical study met its primary goal, showing that the company's system is non-inferior to current treatment options, including radiofrequency or cryoablation.
Economic data released this week set to shape Fed policy
Markets will be dominated by key economic data this week, including the latest inflation data on Thursday and a jobs report on Friday. Key economic data due this week include JOLTS job vacancies on Tuesday, second quarter GDP revisions on Wednesday, core personal consumption expenditures (PCE) on Thursday, and employment and ISM reports on Friday. Earlier on Friday, Powell pointed out that there are signs of continued economic growth and strong consumer spending, and the central bank will "proceed carefully" before considering whether to raise interest rates further. So the data could influence the Fed's monetary policy considerations ahead of its Sept. 19-20 meeting.
Hong Kong Stock Connect had a net inflow of HK$4.1bn on Monday, of which XPeng (9868) had the largest net inflow, reaching HK$0.55bn; followed by HKEX (388). Easy Buy (1797) recorded the largest net outflow at HK$0.2bn, followed by Tencent (700).
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