ASIA STOCKS: HK Equities Outperform, China Equities Struggle On IB Crackdown

Chinese & Hong Kong equities are mixed today with the CSI 300 Index giving up early gains and now testing yearly lows, as reports surfaced that investment bankers are being detained or required to surrender their passports, quickly dampening market sentiment and despite efforts by Chinese authorities to implement stimulus measures, slow execution has hindered progress, especially in addressing property sector challenges with many property indices trading at all time lows, and property bonds struggling to find a bid. While investors expect possible government support from the National Team if equities hit a 5-year low although it may only temporarily delay a further decline.

• Major benchmarks are mixed with the HSI up 1%, property indices have found some support today and trade unchanged, Tech stocks are higher on the back of the prospect of OpenAI's potential $150 billion valuation with the HSTech Index is 1.40% higher, though investors may remain cautious after the Ant Financial IPO collapse. Banking stocks track US peers higher following last night CPI, with the HS Mainland Banking Index +1.10%.
• China is intensifying its crackdown on investment bankers, with at least three top bankers detained since August, and several brokerages requiring employees to hand in passports and seek approval for travel. The crackdown is raising concerns about the future of China's $1.7t brokerage industry, as IPO activities and revenue have sharply declined amidst economic struggles.
• Looking ahead we have Hong Kong PPI & Industrial Production later today, while on Saturday we have Chinese Industrial Production & Retail Sales.