Asian equities showed resilience despite the strength of the US dollar, with Hong Kong, Shanghai, and Shenzhen markets performing well. Real estate stocks saw profit-taking after a strong performance on Friday, leading to declines in the sector in mainland China and Hong Kong. However, new policies announced by the Chinese government have been met with skepticism, despite their potential to support the market. Shenzhen’s implementation of these policies led to strong apartment sales over the weekend, indicating investor interest in the real estate sector.
In Hong Kong, the most heavily traded stocks included Tencent, Alibaba, Meituan, Ping An Insurance, and Sense Time, with varying performance. Mainland investors continued to buy mainland stocks via Southbound Stock Connect, with a year-to-date total of $31.4 billion, slightly lower than the previous year’s net buying. The Loan Prime Rates remained unchanged, signaling stability in the lending market. Didi, a popular ride-sharing company, announced the elimination of the role of President, with Jean Liu stepping down from the role and board but intending to remain with the company.
Tariffs have become a hot topic among politicians, reminiscent of the protectionist policies of the 1920s. The similarities between that era and the current situation, including a pandemic, strong stock market, and rise in protectionism, are striking. The market in Hong Kong saw gains in the Hang Seng and Hang Seng Tech indexes, with positive performance in growth and small caps. The top-performing sectors included Materials, Utilities, and Energy, while Real Estate and Technology saw declines.
In Shanghai, Shenzhen, and the STAR Board, growth and large caps outpaced value and small caps, with positive performance in Energy and Materials sectors. Real Estate and Consumer Discretionary sectors saw declines. Northbound Stock Connect volumes were moderate, with moderate net buys in companies like CATL and Wuliangye. The CNY and the Asia Dollar Index were lower against the US dollar, while treasury bonds fell. Copper and steel prices saw gains.
Upcoming webinars on China’s potential drivers of a sustained equity bull market, as well as discussions on the US-China relations in light of the upcoming presidential election, were announced. Readers are invited to register for these events to gain valuable insights into the market trends and geopolitical dynamics. Additionally, a new article on China’s recent stock market rally and its fundamental differences has been released for readers’ perusal. Last night’s performance showed slight changes in exchange rates, prices, and yields, with minor fluctuations in CNY per USD, EUR, government bond yields, and commodity prices.
