KGI Asia Commentary
Hang Seng Index fell 577 points on Thursday
The Hang Seng Index fell 507 points or 3.0% to 18,533 on Wednesday. HSTECH fell 67 points or 1.7% to 3,948 and HSCEI fell 221 points or 3.4% to 6,268. Daily market turnover was HK$97.2bn.
Dow falls more than 300 points as hot jobs data sparks fears of Fed rate hike
The Dow ended lower on Thursday as data showing a continued hot job market sparked a slew of bets on further rate hikes by the Federal Reserve, sending U.S. Treasury yields soaring ahead of Friday's nonfarm payrolls report. The Dow Jones Industrial Average fell 366.38 points, or 1.07%, to end at 33,922.26. The S&P 500 fell 0.79% to close at 4,411.59. The Nasdaq Composite fell 0.82% to 13,679.04. Thursday's session was the worst one-day performance for the Dow and S&P 500 since May. Consumer stocks were under pressure, dragging consumer shares lower, as homebuilders fell sharply as mortgage rates jumped to their highest level this year amid worries about demand. Big tech companies struggled to shrug off surging U.S. Treasury yields that made it more expensive to own a market-growth sector, but Microsoft Corp rose nearly 1%, boosted by optimism over the artificial intelligence wave. Meanwhile, Meta gave up early gains despite launching Twitter-rival app Threads.
Private sector adds 497,000 jobs in June
Private sector jobs rose by 497,000 in June, much higher than the 267,000 in May and higher than the 228,000 economists expected. The report overshadowed last week's data on a larger-than-expected increase in initial jobless claims and a weaker-than-expected increase in job openings in May, raising concerns that the Fed may follow its guidance to raise interest rates two more times. U.S. services sector activity rose more than expected in June, pointing to further economic strength. Traders are pricing in about a 92 percent chance of a rate hike at the Fed's meeting later this month, according to the CME Group's FedWatch tool.
Hong Kong Stock Connect had a net inflow of HK$3.2bn on Thursday, of which CCB (939) had the largest net inflow, reaching HK$0.29bn; followed by Meituan (3690). HKEX (388) recorded the largest net outflow at HK$0.38bn, followed by Li Ning (2331).
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.
The materials contained herein are provided by KGI Asia Limited ("KGI") for information only. While such materials are based on or derived from sources believed to be reliable, KGI makes no representation or warranty (express or implied) as to their accuracy or reliability. Neither the information nor the opinions expressed herein constitute, or are to be construed as, an offer or invitation or solicitation of an offer to buy or sell any securities or investments. KGI and its officers, employees, agents and affiliates may have interests in the securities or investments covered herein and accept no liability whatsoever for any loss or consequence whatsoever (whether direct or indirect) resulting from any use of or reliance by you on such materials.