Most Lower, Mainland Now Closed Until Next Week

The negative lead from the U.S. and worry surrounding the Taiwan earthquake weighed on Chinese & HK equity benchmarks on Wednesday.

• Elsewhere, desks flagged profit taking/book squaring activity ahead of the elongated weekend (mainland markets are now closed until Monday, HK markets are closed Thursday).
• That left the CSI 300 0.4% lower on the day, with bulls still unable to force a test of technical resistance at the 200-DMA.
• The Hang Seng was also lower on the day, shedding ~1.2%.
• Weakness in Xiaomi was noted, although headline news was lacking. The name saw the heaviest net selling via the southbound HK-China Stock links.
• HK-China Stock Connect links saw ~CNY2.3bn of net outflows from mainland shares.
• Yuan weakness, with USD/CNY moving towards the 2% limit of the trading band for a second consecutive day (see earlier bullets for further colour), will also have factored into the weakness in mainland stocks.
• Names related to Taiwanese construction bucked the broader trend, rallying given rebuild expectations post-earthquake.
• Looking forwards, signs of a Chinese economic uptick will continue to be assessed, with participants still looking for deeper macro policy support.