KGI Asia Commentary
Hang Seng Index fell 11 points on Wednesday
The Hang Seng Index fell 11 points or 0.1% to 17,082 on Wednesday. HSTECH rose 12 points or 0.3% to 3,656 and HSCEI fell 17 points or 0.3% to 5,932. Daily market turnover was HK$120.4bn.
The S&P and Nasdaq close lower on Wednesday as tech stocks take a breather
The Dow Jones Industrial Average edged higher on Wednesday, closing higher for a third straight day on the back of energy stocks, but losses in technology stocks capped gains as investors awaited more economic data on Thursday that could influence the Federal Reserve's decision next week. The S&P 500 fell 0.19% to close at 5,165.31 points, and the Nasdaq fell 0.54% to close at 16,177.77 points. The Dow Jones Industrial Average rose 37.83 points, or 0.1%, to close at 39,043.32 points. Energy stocks were the biggest gainers, led by Valero Energy, Marathon Petroleum and APA, driven by a jump in oil prices after a surprise drop in U.S. inventories for the week. The U.S. Energy Information Administration reported on Wednesday that weekly U.S. crude oil supply fell by 1.5 million barrels last week. In addition to falling domestic supplies, Ukraine's attacks on Russian refineries have also pushed up oil prices. Tesla shares fell more than 4% on Wednesday after Wells Fargo downgraded the electric car giant and described it as a "growth company without growth." Shares of discount retailer Dollar Tree fell 14% after the discount retailer reported fourth-quarter results that fell short of Wall Street expectations and announced plans to close nearly 1,000 stores. Nvidia shares fell more than 1%, weighing on the entire technology sector, although BofA Securities raised its price target on the chipmaker to $1,100 from $925 ahead of next week's GTC conference.
PPI inflation and retail sales data await release
Ahead of the Fed's next meeting, investors will analyze February producer price index (PPI) and retail sales data due out on Thursday for further clues on the strength of inflation and consumer spending respectively. The data was released ahead of the Federal Reserve's March 19-20 meeting, when the Fed is expected to keep interest rates unchanged. Traders see a 60% chance of a 25 basis point rate cut in June, according to CME's Fedwatch tool.
Hong Kong Stock Connect had a net inflow of HK11.4bn on Wednesday, of which Tracker Fund (2800) had the largest net inflow, reaching HK$3.96bn; followed by CSOP HS TECH (3033). Meituan (3690) recorded the largest net outflow at HK$0.2bn, followed by Li Auto (2015).
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