KGI Asia Commentary
Hang Seng Index rose 75 points on Tuesday
The Hang Seng Index closed at 17,874 points for the day, up 75 points or 0.4%. The Hang Seng Technology Index reported at 3,501 points, down 1 points or 0.0%. The HSCEI Index rose 27 points, or 0.4%, to 6,306 points. The market turnover was HK$91.9billion.
Dow closes at record high, focus turns to Nvidia earnings
The Dow closed at a record high on Tuesday, although investors remained cautious as they awaited Wednesday's earnings report from chip-making giant Nvidia. The Dow Jones Industrial Average rose 0.02% (9 points) to close at a record 41,250.50 points. The S&P 500 rose 0.2% and the Nasdaq gained 0.2%. Nvidia's quarterly earnings, due after the market close on Wednesday, are expected to serve as a gauge of whether the artificial intelligence-fueled tech rally has room to continue or whether it will soon run out of steam. In addition to chips, Apple announced late Monday that Luca Maestri will resign as chief financial officer starting in early 2025, which limited Apple's gains. At the same time, the countdown to Apple's product launch scheduled for September 9 continues to be the focus of investors, with some bullish on technology stocks predicting that the technology giant's upcoming new iPhone may trigger a historic upgrade cycle. Paramount shares fell 7% after billionaire Edgar Bronfman Jr pulled out of a fight for control of the media conglomerate, potentially allowing Skydance Media to acquire the media without a bid control of the group.
Consumer confidence rises as recession fears ease
The Conference Board reported on Tuesday that U.S. consumer confidence hit a six-month high in August as fears of a recession receded. In addition, 2Q GDP data will be released on Thursday, and PCE data, the Fed's preferred inflation measure, will be released on Friday. Traders unanimously predict the Fed will cut interest rates by at least 25 basis points on September 17-18, according to data from CME Group's FedWatch Tool.
Hong Kong Stock Connect had a net outflow of HK2.87bn on Tuesday of which Tracker Fund (2800) had the largest net inflow, reaching HK$0.11bn; followed by CCB (939). Meituan (3690) recorded the largest net outflow at HK$0.08bn, followed by CNOOC (883).
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