KGI Asia Commentary
Hang Seng Index fell 433 points on Tuesday
The Hang Seng Index fell 433 points or 2.6% to 16,162 on Tuesday. HSTECH fell 150 points or 4.3% to 3,323 and HSCEI fell 150 points or 2.6% to 5,562. Daily market turnover was HK$112.1bn.
Dow closes down 400 points
U.S. stocks fell for a second consecutive session on Tuesday, with sharp losses in major technology stocks such as Apple dragging the market further away from recent all-time highs. The Nasdaq fell 1.65% to close at 15,939.59 points, with technology stocks bearing the brunt. The Dow Jones Industrial Average fell 404.64 points, or 1.04%, to 38,585.19. The S&P 500 fell 1.02% to close at 5,078.65 points. A report from Counterpoint Research showed that iPhone sales in China fell sharply in the first six weeks of 2024, and Apple's stock price fell by nearly 3%. Tesla shares fell 4% as the electric vehicle giant said its China-made vehicle shipments fell 19% year-on-year to 60,365 vehicles, the lowest level since December 2022, due to disruptions caused by the Lunar New Year holiday. Target reported fourth-quarter adjusted earnings per share that exceeded analysts' average forecast, pushing its stock price up more than 12%. The big-box retailer also detailed plans to launch a new paid membership program to keep sales strong amid growing consumer caution. Meanwhile, Bitcoin fell more than 7% after hitting an all-time high of $68,874, as investors appeared to take profits on the popular cryptocurrency.
Powell may urge Fed to be cautious and not cut rates too early
Federal Reserve Chairman Jerome Powell will offer a two-day testimony before Congress on Wednesday and Thursday, which may reflect the need for patience in cutting interest rates. Several Fed officials warned against betting on an early interest rate cut, citing concerns about stubbornly high inflation and the resilience of the U.S. economy. Atlanta Federal Reserve Bank President Raphael Bostic said on Monday that continued bets that the Federal Reserve would cut interest rates early could trigger rising inflationary pressures. In addition to Powell's testimony, the focus this week will be on the key February non-farm payrolls data.
Hong Kong Stock Connect had a net inflow of HK5.92bn on Tuesday, of which Tencent (700) had the largest net inflow, reaching HK$0.69bn; followed by Meituan (3690). PetroChina (857) recorded the largest net outflow at HK$0.16bn, followed by Wuxi Bio (2269).
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