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Higher In Asia; Chinese Stocks Reverse Early Losses As Policy Support Calls Grow Louder

EQUITIES

Most Asia-Pac equity indices trade higher at typing, tracking a strongly positive lead from Wall St. High-beta names across various sectors were notable outperformers, likely benefitting from spillover from an unwinding of worry re: larger Fed rate hikes in ‘22. Japanese and South Korean markets are shut for a holiday.

  • The Hang Seng Index sits 0.8% firmer at typing, paring opening gains particularly after Chinese Caixin PMIs crossed, pointing to further contraction in the Services industry (while also corroborating with earlier official estimates). China-based tech leads gains despite fresh reports of U.S. regulators expanding their list of Chinese companies facing the boot from U.S. exchanges over a well-documented audit dispute, with Bilibili Inc, Baidu Inc, and Meituan contributing the most to gains, seeing the Hang Seng Tech Index add 1.7% at writing.
  • Zooming out, PBOC’s pledge on Wednesday to “normalise” supervision for internet platform companies appears to have been met with lukewarm reception overall, with the Hang Seng Tech Index trading below three-week highs seen last Friday’s (with that move spurred by similar comments from the CCP’s Politburo meeting).
  • The CSI300 deals 0.5% firmer at typing, breaking above neutral levels on a broad surge across virtually all sub-indices, with the most gains contributed by the heavyweight consumer staples sub-index. Chinese equities caught a bid after state media reported on a swathe of measures to promote investments, exports, and support internet platform companies, again reinforcing recent messages from the Politburo and the PBOC. While the announcements have been light on details thus far, Chinese state media has notably carried analyses pointing to possible state support for internet platform companies (particularly to help “stabilise growth” and “ensure employment”), and also on possible further easing of curbs on the property sector.
  • U.S. e-mini equity index futures sit a little below neutral levels at typing, trading within a fairly limited range in Asia-Pac dealing after closing ~3% high after Powell’s presser.
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Most Asia-Pac equity indices trade higher at typing, tracking a strongly positive lead from Wall St. High-beta names across various sectors were notable outperformers, likely benefitting from spillover from an unwinding of worry re: larger Fed rate hikes in ‘22. Japanese and South Korean markets are shut for a holiday.

  • The Hang Seng Index sits 0.8% firmer at typing, paring opening gains particularly after Chinese Caixin PMIs crossed, pointing to further contraction in the Services industry (while also corroborating with earlier official estimates). China-based tech leads gains despite fresh reports of U.S. regulators expanding their list of Chinese companies facing the boot from U.S. exchanges over a well-documented audit dispute, with Bilibili Inc, Baidu Inc, and Meituan contributing the most to gains, seeing the Hang Seng Tech Index add 1.7% at writing.
  • Zooming out, PBOC’s pledge on Wednesday to “normalise” supervision for internet platform companies appears to have been met with lukewarm reception overall, with the Hang Seng Tech Index trading below three-week highs seen last Friday’s (with that move spurred by similar comments from the CCP’s Politburo meeting).
  • The CSI300 deals 0.5% firmer at typing, breaking above neutral levels on a broad surge across virtually all sub-indices, with the most gains contributed by the heavyweight consumer staples sub-index. Chinese equities caught a bid after state media reported on a swathe of measures to promote investments, exports, and support internet platform companies, again reinforcing recent messages from the Politburo and the PBOC. While the announcements have been light on details thus far, Chinese state media has notably carried analyses pointing to possible state support for internet platform companies (particularly to help “stabilise growth” and “ensure employment”), and also on possible further easing of curbs on the property sector.
  • U.S. e-mini equity index futures sit a little below neutral levels at typing, trading within a fairly limited range in Asia-Pac dealing after closing ~3% high after Powell’s presser.