KGI Asia Commentary
Hang Seng Index fell 225 points on Wednesday
The Hang Seng Index fell 225 points or 1.4% to 16,392 on Wednesday. HSTECH fell 78 points or 2.2% to 3,393 and HSCEI fell 97 points or 1.7% to 5,728. Daily market turnover was HK$115.6bn.
S&P 500 hits record high as U.S. Treasury yields fall
The S&P 500 closed at a record high on Wednesday as U.S. Treasury yields fell ahead of a speech delivered by Federal Reserve Governor Christopher Waller and more clues on inflation. The S&P Index rose 0.86% to close at 5,248.49 points; the Dow Jones Industrial Average rose 477.75 points to close at 39,760.08 points, an increase of 1.22%. Both major stock indexes ended three consecutive days of losses. The Nasdaq rose 0.51% to close at 16,399.52 points. U.S. stocks rose across the board on Wednesday, with all 11 sectors of the S&P 500 rising. The utility sector led the gains, rising nearly 2.8%. The real estate sector rose 2.4% and industrial stocks gained 1.6%. On the corporate front, pharmaceutical giant Merck's shares rose 5% to hit a record high after the U.S. Food and Drug Administration approved the company's drug to treat a rare lung disease. Trump Media & Technology Group surged more than 14% on its Nasdaq debut, while Robinhood Markets rose more than 3% as the online trading app launched a new credit card to expand its presence in the personal finance market. Rate. On the other hand, video game retailer GameStop reported a drop in fourth-quarter revenue due to slowing spending and increased competition from online companies. The company's shares fell 15%. The company also said it had cut some jobs to reduce costs. Carnival Corp. reported better-than-expected first-quarter earnings, sending its shares up 1% and raising its full-year earnings per share forecast to 98 cents from 93 cents previously. Shockwave Medical shares rose 2%, extending a 10% gain previously, after reports that Johnson & Johnson was in talks to acquire the medical device maker. Consumer products maker Kimberly-Clark closed nearly 1% higher after announcing plans to reorganize into three business units to streamline operations and cut costs.
Falling oil prices cap gains in energy stocks after sharp rise in U.S. inventories
Energy stocks rose, but gains were limited as oil prices fell after industry data showed a sharp build in U.S. crude inventories last week. Data from the U.S. Energy Information Administration (EIA) showed that inventories increased by 3.2 million barrels in the week ended March 22, exceeding expectations for a decrease of 700,000 barrels. However, JPMorgan Chase expects Brent crude oil prices to rise to $100 a barrel this year without countermeasures to balance Russia's decision to cut production.
Hong Kong Stock Connect had a net inflow of HK6.56bn on Wednesday, of which Tencent (700) had the largest net inflow, reaching HK$0.87bn; followed by Tracker Fund (2800). Yankuang (1171) recorded the largest net outflow at HK$0.31bn, followed by SMIC (981).
Wen Kit Kenny is a SFC licensed person accredited to KGI Group to carry on regulated activities (for details, please refer to:https://apps.sfc.hk/publicregWeb/indi/AJF244/details). He and/or his associate do not have any financial interest in the recommended issuer or new listing applicant.
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