KGI Asia Commentary
Hang Seng Index fell 351 points on Tuesday
The Hang Seng Index fell 351 points or 2.1% to 16,248 on Tuesday. HSTECH fell 104 points or 3.0% to 3,337 and HSCEI fell 112 points or 1.9% to 5,743. Daily market turnover was HK$114.5bn.
Powell give signal rates need to remain high for longer
U.S. stocks closed mixed on Tuesday. The Dow Jones index rose 63.66 points, or 0.17%, to 37798.77 points; the Nasdaq index fell 19.77 points, or 0.12%, to 15865.25 points; the S&P 500 index fell 10.44 points, or 15865.25 points. It was 0.21% and reported at 5051.38 points.
After many Federal Reserve officials earlier expressed concerns about inflation and indicated that they may slow down or delay the interest rate cut schedule, yesterday Fed Chairman Powell hinted that stubborn inflation may cause the central bank to maintain high interest rate policies for a longer period of time, saying that it will take more time to build enough confidence to cut interest rates. It also pointed out that if the Fed lacks more progress in fighting inflation and if price pressures persist, the Fed might keep interest rates unchanged "for as long as necessary."
The remarks once again aroused market concerns about the trend of interest rates this year. U.S. bond yields continue to rise, with the 10-year U.S. bond yield approaching 4.7%.
China's first-quarter GDP growth beat expectations
China announced a number of important data yesterday. The performance was mixed, and the market is most concerned about China's first-quarter GDP performance year-on-year. The announced value was 5.3%, which was higher than market expectations of 4.8% and in line with the central government's annual growth target of about 5%. On the other hand, fixed asset investment performance also exceeded expectations, but industrial added value and social retail sales data were lower than market expectations.
Hong Kong Stock Connect saw a net inflow of HK$9.877 billion on Tuesday, of which Tracker Fund (2800) had the largest inflow, reaching HK$2.68 billion; followed by Tencent Holdings (700). Anta Sports (2020) recorded the largest net outflow of HK$309 million; followed by Meituan (3690).
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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