KGI Asia Commentary
HSI rose 228 points on Wednesday
The Hang Seng Index opened 292 points higher this morning and opened at 17,957. It closed at 17,893, up 228 points or 1.3%. The HSTECH reported at 3,952, up 77 points or 2.0%. The HSCEI rose 80 points or 1.3% to 6,132. The market turnover was HK$88.80bn. Pharmaceutical and biotechnology stocks were generally speculated, with stocks such as WuXi Biologics (2269) and Innovent Biologics (1801) rising between 3.6% and 10.6%. The State Administration of Financial Supervision proposed to expand automobile consumption, BYD (1211) and Li Auto (2015) rose 1.9% and 3.5% respectively.
U.S. September PPI heats up on rising oil prices
The U.S. producer price index (PPI) rose 0.5% MoM in September, down from 0.7% last month but still exceeding consensus of 0.3%. It rose 2.2% YoY, higher than the 2% increase in August. Excluding food and energy factor, the core PPI rose 2.8% YoY, lower than market consensus of 3.0%, and the revised previous value was 2.9%. The factor that accelerated the rise of PPI in September was obviously energy prices, which increased by 3.3% YoY, of which the gasoline index increased by 5.4%. International oil prices have increased significantly since September, which continues to push up the prices of aviation fuel and electricity.
All three major U.S. stock indexes recorded gains. The Nasdaq composite rose 96 points, or 0.71%, to close at 13,659; the S&P 500 rose 18 points, or 0.43%, to close at 4,376; the DJIA rose 65 points, or 0.19%, to close at 33,804.
September FOMC minutes made clear that high interest rates will need to remain high for a period
The U.S. Federal Reserve released the minutes of its September meeting. According to the document, most officials believe it is more appropriate to raise interest rates one more time. They need more evidence to be convinced that inflation is clearly eased. All members agreed that policy should remain restrictive for a period until inflation has sustained a downward trend to achieve the Fed's 2% inflation target, so the "Higher for Longer" is believed to continue next year.
The net inflow of Hong Kong Stock Connect on Wednesday was HK$1.33bn. Among them, Meituan (3690) had the largest inflow, reaching HK$888mn; followed by Sunny Optical (2382). China Mobile (0941) recorded the largest net outflow of HK$306mn; followed by Tencent (0700).
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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