KGI Asia Commentary

HSI fell 230 points on Thursday

The Hang Seng Index fell 230 points or 1.3% to 17,665 on Thursday. HSTECH fell 72 points or 1.8% to 3,849 and HSCEI fell 82 points or 1.3% to 6,099. Daily market turnover was HK$77.4bn.

U.S. stocks fall as rising Treasury yields rattle markets

Wall Street tumbled on Thursday, weighed down by a rise in U.S. Treasury yields after data showed the job market remained tight as investors continued to digest the prospect of the Federal Reserve keeping interest rates high for longer. The Dow Jones Industrial Average fell 370.46 points, or 1.08%, to close at 34,070.42 points. The S&P 500 fell 1.64% to 4,330 points. The Nasdaq fell 1.82% to 13223.98 points. Large technology stocks extended losses during the session as market expectations that the Federal Reserve will maintain high interest rates for a longer period of time have led to continued increases in U.S. Treasury yields and continued pressure. In addition to rising yields, a decline in semiconductor stocks led by Broadcom has also weighed on technology stocks as Alphabet's Google is reportedly considering whether to drop Broadcom as its artificial intelligence chip supplier by 2027 manufacturers, switching to using their own chips. According to reports, Broadcom's increase in the price of its artificial intelligence chips has triggered internal discussions at Google. Google said in a statement that it was still "productively engaged" with Broadcom for the long term. Cisco Systems Inc. shares fell nearly 4% as investors showed little interest in the company's $28 billion acquisition of cybersecurity software company Splunk Inc. FedEx shares closed up more than 4% as analysts welcomed better-than-expected first-quarter earnings and progress on cost-cutting measures, with expectations that the company's profit margins will continue to improve.

Fresh signs of tight labor market push Treasury yields higher

U.S. bond yields continue to rise, and the number of initial jobless claims last week was lower than expected, indicating that the job market continues to be strong and inflation may heat up. Initial jobless claims fell to 201,000 in the week ended September 16, compared with 221,000 the previous week, the lowest level since January. A still-strong labor market has fueled concerns that the Fed may have to do more to curb inflation, a day after the Fed announced a "hawkish pause" that pushed the 10-year Treasury yield to its highest level since 2006. the highest level.

Hong Kong Stock Connect had a net outflow of HK$3.2bn on Thursday, of which China Mobile (941) had the largest net inflow, reaching HK$0.88bn; followed by Ping An (2318). Kuaishou (1024) recorded the largest net outflow at HK$0.16bn, followed by Li Ning (2331).