KGI Asia Commentary
Hang Seng Index rose 458 points on Thursday
The Hang Seng Index rose 458 points or 2.3% to 20,049 on Thursday. HSTECH rose 189 points or 4.7% to 4,198 and HSCEI rose 196 points or 3.0% to 6,836. Daily market turnover was HK$136.3bn.
Tech edged higher Thursday, as market expect an end of rate hike soon
The Dow ended higher on Thursday, as gains in technology stocks were held back by renewed selling in regional banks, as concerns about the banking system persisted despite growing bets that the Fed's rate hike cycle will soon be over. The Dow Jones Industrial Average rose 0.2%, the Nasdaq rose 1% and the S&P 500 rose 0.3%. U.S. Treasury yields fell again on bets the Federal Reserve may pause rate hikes. The U.S. Federal Reserve raised interest rates by 25 basis points on Wednesday, forecast one more hike this year and ruled out a rate cut, but markets were unconvinced. Market expects an end of rate hike soon. Meta Platforms, Apple, Microsoft and Google were slightly higher. But bank stocks resumed losses as First Republic return to firing line, even though U.S. Treasury Secretary Janet Yellen said on Thursday the bank was willing to step in again if necessary to stabilize regional lenders.“We have used important tools to act quickly to prevent contagion. And they are tools we could use again,” Yellen said in written testimony before a House Appropriations subcommittee.
U.S. jobless claims less than expected, means labor market remain tight
On the economic data front, weekly jobless claims continued to point to a strong labor market and a persistent labor shortage. Data from the Labor Department on Thursday showed initial jobless claims fell by 1,000 last week to 191,000. The figure was well below market expectations of 197,000, compared with an unrevised 192,000 the previous week.
Hong Kong Stock Connect had a net inflow of HK$0.82bn on Thursday, of which Tencent (700) had the largest net inflow, reaching HK$1.44bn; followed by Meituan (3690). Tracker Fund (2800) recorded the largest net outflow at HK$0.91bn, followed by HSCEI ETF (2828).
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