KGI Asia Commentary
HSI fell 57 points on Thursday
The Hang Seng Index fell 57 points or 0.3% to 17,511 on Thursday. HSTECH rose 3 points or 0.1% to 4,024 and HSCEI fell 9 points or 0.2% to 6,030. Daily market turnover was HK$75.3bn.
Dow closes lower as Powell hints rate hike is still possible
The S&P 500 fell on Thursday, snapping an eight-day winning streak, as a sharp rise in yields unnerved investors. The S&P 500 fell 0.81% to close at 4,347.35 points; the Nasdaq fell 0.94% to close at 13,521.45 points. The Dow Jones Industrial Average fell 220.33 points, or 0.65%, to close at 33,891.94 points. Shares of Becton Dickinson and Company fell more than 9%, weighing on the health care sector, after the company reported weaker annual guidance, offsetting better-than-expected quarterly revenue. Tesla shares fell 6%, leading consumer stocks lower, as HSBC had a sell rating on the electric car maker on concerns it could take longer than expected to implement its ideas. Luxury fashion company Tapestry's profits exceeded expectations, but revenue was lower than expected. Its full-year outlook for 2024 was basically in line with expectations, and its stock price rose 3.8%. Walt Disney shares rose more than 6% after the entertainment giant reported fourth-quarter earnings that beat estimates, driven by subscriber growth for its streaming service and higher attendance at theme parks in Shanghai, Hong Kong and California. Meanwhile, the number of Americans filing for unemployment benefits edged down last week, suggesting layoffs remain low even as the still-strong job market shows some signs of cooling. Initial jobless claims fell by 3,000 in the week ended November to a seasonally adjusted 217,000.
Powell says Fed is 'uncertain' it's done enough to lower inflation
“The Federal Open Market Committee is committed to achieving a stance of monetary policy that is sufficiently restrictive to bring inflation down to 2 percent over time; we are not confident that we have achieved such a stance,” he said in his prepared speech. “My colleagues and I are gratified by this progress but expect that the process of getting inflation sustainably down to 2 percent has a long way to go,” he said. “We will keep at this until we succeed,” he later added. He said the Fed is focused on whether interest rates need to go higher and how long they need to stay high. U.S. bond yields rose after Powell's speech and stocks fell.
Hong Kong Stock Connect had a net outflow of HK$5.0bn on Thursday, of which Tracker Fund (2800) had the largest net inflow, reaching HK$1.53bn; followed by CSOP HS TECH (3033). SMIC (981) recorded the largest net outflow at HK$0.08bn, followed by CNOOC (883).
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