KGI Asia Commentary
HSI rose 436 points on Friday
The Hang Seng Index closed at 17,809, up 436 points or 2.5%. The HSTECH was at 3,920, up 142 points or 3.8%. The HSCEI rose 157 points, or 2.6%, to 6,148. Market turnover reached HK$67.65bn.
World Bank downgrades East Asian economies' growth next year
The World Bank is worried that the Chinese economic growth is not as good as expected and has lowered the economic growth of East Asia next year, from 4.8% in April to 4.5%, lower than the 5% expected this year. In addition to the existing problems in China, including the bursting of the real estate bubble and increasing household debt, some emerging countries in the Asia-Pacific region, such as Vietnam and Indonesia, have been suffered by the U.S. "Inflation Reduction Act" and "Chip Act". Such "protectionism" bills divert trade from Southeast Asian countries to US neighboring countries that have agreements with each other, such as Canada and Mexico.
The three major U.S. stock indexes had different trends. The Nasdaq composite rose 88 points or 0.67% to close at 13,307; the S&P 500 closed flat at 4,288; the DJIA fell 74 points or 0.22% to close at 33,433.
Mainland Caixin PMI is above 50
During the National Day holiday, China have announced the Purchasing Managers Index (PMI) for September. The Caixin Composite PMI fell by 0.8 percentage points to 50.9, which was the lowest for the year. Above 50 reflected that the economy has still expanded but the momentum is clearly continuing to shrink. The manufacturing PMI fell back to 50.6, down 0.4 percentage points from August and lower than the expected 51.2. Among them, the total number of new orders has increased for two consecutive months, and the volume of new export orders has declined slightly, but the decline has been the smallest in three months. The service PMI, which performed better this year, fell to 50.2, down 1.6 percentage points from the previous month. Among the detailed items, the business activity index and the new orders index have been above the 50-point boom-bust line for nine consecutive months, but both recorded new lows in the past nine months. The number of overseas tourists has increased, and overseas orders have increased slightly.
Hong Kong Stock Connect will be suspended due to the National Day holiday until October 9.
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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