KGI Asia Commentary
Hang Seng Index fell 373 points on Thursday
The Hang Seng Index opened 144 points lower at 17,946 points. The decline significantly expanded to 373 points to 17,716 points on Thursday; the HSCEI Index fell 153 points, or 2.4%, to 6,324 points; the Hang Seng Technology Index fell 101 points or 2.7%, reported at 3,589 points. The total daily turnover of the market was HK$104.2 billion. Consumer stocks continued to underperform, with TINGYI (322), Nongfu Spring (9633) and Haier Smart Home (6690) fell 6.5%, 7.3% and 5.4% respectively. Telecom stocks rose against the Hang Seng Index, with China Unicom (762) and China Mobile (941) rose1.3% and 0.6% respectively.
IMF slightly lowers U.S. real GDP growth rate by 0.1 percentage point
U.S. stocks closed slightly higher on Thursday. The Dow Jones index rose 36.26 points, or 0.09%, to 39164.06 points; the Nasdaq index rose 53.53 points, or 0.30%, to 17858.68 points; the S&P 500 index rose 4.97 points, or 0.09%, reported 5482.87 points. In terms of individual stocks, Micron's fourth-quarter guidance failed to meet Wall Street expectations, and its stock price fell 7.1%, while Nvidia's stock price also fell 1.9%.
In terms of economic data, yesterday the United States announced that the Initial Jobless Claims for the week as of June 22 dropped to 233,000, which was lower than the expected 236,000; while the Continuing Jobless Claims for the week as of June 15 rose to about 1.84 million. In addition, the market is waiting for the PCE to be released today. The current market forecast is +2.6% year-on-year and 0.0% month-on-month.
Finally, the International Monetary Fund (IMF) said that the U.S. fiscal deficit is too large, and its debt burden is increasing, and warned that its increasingly aggressive trade policies may pose risks. IMF lowered its 2024 U.S. real GDP growth forecast from 2.7% to 2.6%.
Industrial enterprise profit growth slowed in first five months
The National Bureau of Statistics released the profit of industrial enterprises in the first five months. Although revenue growth accelerated 0.3 percentage points from the previous value to 2.9%, total profits showed a slowdown in growth, a reduction of 0.9 percentage points from the previous value to 3.4%. In terms of industrial categories, 32 industries recorded year-on-year profit growth, one more industry recorded profit growth, compared to the previous value. The decline in profit growth of state-owned enterprises narrowed 0.4 percentage points from the previous value to 2.4%, while private enterprises continued to expand their profit growth by 0.8 percentage points to 7.6%. The efficiency of industrial enterprises still needs to be further consolidated and strengthened.
Hong Kong Stock Connect had a net inflow of HK3.65bn on Thursday, of which China Mobile (941) had the largest inflow, reaching HK$830 million; followed by Industrial and Commercial Bank of China (1398). Tencent (700) recorded the largest net outflow of HK$470 million, followed by Li Ning (2331).
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