Hang Seng Outperforms, Still Comfortably Lower In ‘21

Thursday’s rally in Chinese ADRs spilled into Asia-Pac trade, supporting the Hang Seng Tech sector (although the NASDAQ Golden Dragon China index is still over 40% lower on a YtD basis), with the Hang Seng adding over 1% come the end of a curtailed trading session. The space was no doubt aided by comments from the CSRC Chair, made late Thursday, as he noted that the regulator will take measures to smooth capital market operations, to prevent major swings, while introducing more pro-growth policies to stabilise expectations. Still, the Hang Seng shed ~14% in ’21, with most of those losses coming on the back of the well-documented regulatory crackdowns in China & property sector woes.

• The remaining major regional equity indices traded in a limited fashion. The session was hampered by lower liquidity with early closes in the ASX 200 & Hang Seng in play, while Japan’s 4-day weekend got underway.
• Thursday’s late downtick in e-minis extended in early Asia-Pac trade, with a lack of headline flow evident as some pointed to the usual year-end profit taking in thin markets after a bumper year for U.S. equities. E-minis subsequently recovered from worst levels with the 3 major contracts sitting ~0.2% below settlement levels at typing.