KGI Asia Commentary

HSI fell 429 points on Tuesday

After the Hang Seng Index opened 45 points lower on Tuesday, the index once recovered all the losses, but the Hang Seng Index then fell another 429 points, or 2.1%, to 19,868 points at market close; the China Enterprises Index fell 162 points, or 2.4%, to 6,735 point; The Hang Seng Technology index fell 116 points, or 3%, to 3,799 point. The market's turnover was HK$ 122.1 bn. Chip stocks were under pressure, SMIC (981) and Hua Hong Semiconductor (1347) fell 6.3% and 3.1% respectively. China Special Estimates retreated, Ping An (2318) fell 3.9%, and China Pacific Insurance (2601) fell 2.9%.

The U.S. CPI data will soon to release today, and the debt ceiling discussion is still inconclusive

Investors continue to wait for the CPI data that will be released today. On Tuesday, the three major US stock indexes closed down. The Dow Jones index fell 57 points, or 0.2%, to 33,562 points; the Nasdaq index fell 77 points, or 0.6%, at 12,179 point; the S&P 500 index fell 19 points, or 0.5%, to 4,119 point.

In addition, the recent market is still focusing on the US debt ceiling. US President Biden and House Speaker Kevin both said that the meeting held yesterday (9th) was just an opportunity for dialogue, and there is still no clear way to raise the debt ceiling at the moment. The conflict between the two parties are cutting spending or further raising the ceiling. From the current market point of view, it is expected that there is little possibility of solving the problem in the short term.

CPCA released the passenger car data for April

CPCA announced yesterday (9th) the retail sales data of the passenger car market. The sales volume in April reached 1.63 million units, a year-on-year increase of 55.5% and a month-on-month increase of 2.5%. The retail sales of new energy vehicles reached 527,000 units, an increase of 85.6% year-on-year, and a decrease of 3.6% month-on-month. The cumulative sales of new energy vehicles in the first four months were 1.843 million units, an increase of 36% year-on-year, and the retail penetration rate increased by 6.6 percentage points to 32.3%. In addition, CPCA pointed out that the passenger car industry has broken away from the background of a high-profit industry, and the profit margin of the auto industry is only 3.8%.

Hong Kong Stock Connect had a net inflow of HK$ 940 mn on Tuesday, among which China Shenhua (1088) had the largest net inflow of HK$500 million; followed by PetroChina (857). SMIC (981) recorded the largest net outflow of HK$520 million, followed by China Construction Bank (939).