A Heavy Start To The Year As Familiar Worries Remain

MNI (London) - The CSI 300 shed 0.3% and the Hang Seng lost 1.7%, as several factors weighed on Chinese equities on Tuesday:

• Mixed PMI data out of China (with the official readings softer-than-expected, while the Caixin m’fing PMI beat expectations).
• Worry surrounding the latest Chinese home sales data, which pressured property developers.
• A rare admission from Chinese President Xi re: some economic difficulties in ’23, which triggered a reiteration to strengthen economic momentum and job creation.
• A marginally negative lead from Wall St.
• A move lower in U.S. Tsy futures (cash Tsys were closed until the London open).
• A potential spill over in sentiment surrounding the Japanese earthquake (Japanese markets are closed until Thursday).
• Worry surrounding the growth in Chinese use of electric vehicles weighed on related EV producers.
• Chipmakers were on the defensive as BBG sources suggested that “ASML Holding cancelled shipments of some of its machines to China at the request of US President Joe Biden’s administration.”
• Industrial Bank fell as the Shanghai Stock Exchange noted that it is looking into abnormal fluctuations in the company’s equity price.
• Li Ning struggled on a notable brokerage price target cut.
• Shippers benefited from news re: Maersk halting Red Sea transit.
• Coal names moved higher as China reinstated import levies on coal at the turn of the year.
• Aluminium-linked names benefitted from a rally in related material futures.
• Film- & travel-related stocks benefitted from NY holiday figures.
• Northbound net flows via the HK-China Stock Connect schemes saw mainland outflows of CNY5.3bn.