KGI Asia Commentary
Hang Seng Index fell 91 points on Monday
Hang Seng Index opened 41 points lower and fell 135 points at once. It narrowed its losses afternoon. The HSI closed at 16,634 today, down 91 points or 0.5%. The HSTECH was at 3,393, down 6 points or 0.2%. The HSCEI fell 41 points, or 0.7%, to 5,723. The market turnover was HK$83.55bn yuan. After BYD (1211) launched low-priced models earlier, it recently launched a model priced at RMb1.68mn. It is believed that it will seize market share in all aspects. The stock price rose 1.5% to HK$187.9. After being downbeat by major banks last week, Lenovo (0992) reiterated today that it is supported by other banks. The stock price rose 4.1% to HK$8.9.
Japan's CPI in January is higher than expected; Annual salary negotiation in March becomes vital
Japan announced its January CPI, which was overall higher than market consensus. Headline CPI increased by 2.2% YoY, higher than the expected 1.9%. The core CPI excluding food and energy was 3.5%, higher than the expected 3.3%, but still slightly slower than the 3.7% last month. The higher-than-expected inflation figures have made market to pay more attention to Japan's salary negotiations in March, with wage increases expected to reach the highest level in 31 years, reaching 3.9%. Please noted that in the past two years, the company fully accepted the union's demands on the first negotiation day. If labor continues to win this year, we believe it will help boost private consumption confidence.
All three major U.S. stock indexes fell yesterday, with the S&P 500 falling 19 points or 0.38% to 5,069; the DJIA falling 62 points or 0.16% to 39,069; and the Nasdaq composite falling 20 points or 0.13% to 15,976.
The market expects the U.S. core PCE monthly growth rate to increase
The market is paying attention to vary US economic figures to be released this week. Durable goods orders and the ISM manufacturing index will reflect whether the U.S. economy can maintain moderate growth despite high interest rates. The core PCE released on Thursday. Referring to the January CPI YoY growth rate, is more likely to accelerate the monthly increase in core PCE% this time. The market estimates a monthly increase of 0.4%, which is higher than 0.2% in Dec. However, under the high base effect, the annual rate of core PCE is expected to maintain a downward trend, falling slightly to 2.8% in January from 2.9% last month.
The net inflow of Hong Kong Stock Connect on Monday was HK$1.76bn, of which CNOOC (0883) had the largest inflow, reaching HK$981mn; followed by Li Auto (2015). Tencent Holdings (0700) recorded the largest net outflow, at HK$261mn; followed by Tracker Fund (2800).
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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