Indices Lower Again On Wednesday

MNI (London) - A generally negative lead from Wall St. and Tuesday’s move higher in core global yields helped apply pressure to Chinese & HK equity indices on Wednesday.

• The CSI 300 shed 0.2% while the Hang Seng lost 0.9%.
• The major tech sub-indices struggled given the move higher in yields.
• Looking into the details, Tencent and NetEase managed to more than reverse initial declines, eventually benefitting from the late Tuesday RTRS sources piece which pointed to China removing “an official at a government body overseeing its press and publications regulator.” That story came after the well-documented December draft re: a regulatory clampdown on the online gaming sector, which pressured names linked to the space.
• Names linked to Apple struggled after Barclays lowered their rating for the tech giant, triggering a heavy round of NY trade in the name.
• Meanwhile, property sub-metrics were pressured by reports of another property developer missing USD bond-related payments. That helped unwind early bids linked to the PSL injection seen in December.
• Widespread reports covering a Morgan Stanley note pointing to active, long-only global funds shedding the third largest ever monthly amount of Chinese & HK stocks during December will have added further pressure.
• Still, on the day the Northbound HK-China Stock Connect legs saw modest inflows for mainland stocks (CNY1.7bn).