China Fintech Pressure Weighs On Broader Equities

Equities traded on the defensive in Asia-Pac hours, although losses were generally modest. The Hang Seng was the exception to the "modest" rule, leading the way lower, shedding 1.5% as of typing, after the WSJ noted that "China is reining in the ability of the country's internet giants to use big data for lending, money-management and similar businesses, ending an era of rapid growth that authorities said posed dangers for the financial system. On Thursday, China's central bank and other regulators ordered 13 firms, including many of the biggest names in the technology sector, to adhere to much tighter regulation of their data and lending practices." U.S. e-minis also ticked lower. Participants eyed the potential for equity negative month-end rebalancing flows from funds, given the general outperformance for equities vs. bonds in the month of April (although most calculations point to fairly modest rebalancing flows, at least from a historical perspective). Softer than expected official Chinese PMI data (although still expansionary) also provided some headwinds, although the SME-focused Caixin m'fing PMI survey, also out of China, topped expectations.