Key News
Asian equities were mixed but mostly higher overnight as Japan and South Korea underperformed and Mainland China’s main boards outperformed.
This year’s Singles Day will be an important check in on the consumer especially in light of the stimulus measures announced and the potential for direct consumer support to come our of the National People’s Congress later this month.
Alibaba kicked off its Singles Day presales yesterday at 8 pm China time. In the first hour, 20 home appliance and furniture merchants passed RMB 100 million ($7.1 million) in sales. Apple products, robot vacuums, and sports apparel are trending among the top categories so far on Tmall and TaoBao. Apple products saw RMB 1 billion ($712 million) in orders in the first five minutes. Apple must be running a special deal this year on the platforms. stepping up to the plate to competition from the likes of Huawei and Xiaomi in China.
There was some chatter overnight about a new stock market stabilization fund to be set up by the Chinese Academy of Social Sciences’ Institute of Finance to the tune of RMB 2 trillion.
China reported retail sales data for September. Total retail sales saw a slight pickup in year-over-year growth rate from August, though online retail sales slowed. This could be due to the consumption shift to larger items after the subsidies were announced later this year. JD is the strongest online marketplace for home appliances, but sales in such items might skew more to brick-and-mortar compared to other product categories.
Online video platform iQiyi is surging in US trading this morning on a new co-production agreement with GHY Culture & Media Holdings.
Semiconductor Manufacturing (SMIC) was the top-traded name in Hong Kong by value on the semiconductor comeback following positive earnings from TSMC last week. Investors might be taking profits in Nvidia and distributing them across the global ecosystem.
Meituan gained +1.99% and was the second-most traded name in Hong Kong, perhaps being boosted by positive reports from Golden Week travel bookings on the platform. It is still early for internet earnings for the third quarter. Meituan will report in mid-November, which is around the time we can expect reports from most internet names. Nonetheless, growth names including internet led gains in Hong Kong overnight.
The Hang Seng and Hang Seng Tech indexes gained +0.10% and +0.66%, respectively, on volume that decreased -21% from yesterday. The top-performing sectors were Utilities, which gained +2.16%, Consumer Staples, which gained +1.11%, and Consumer Discretionary, which gained +0.64%. Meanwhile, the worst-performing sectors were Financials, which fell -0.15%, Materials, which fell -0.09%, and Communication Services, which fell -0.03%.
Shanghai, Shenzhen, and the STAR Board diverged to close +0.54%, +0.86%, and -1.45%, respectively, on volume that decreased -12% from yesterday. The top-performing sectors were Consumer Discretionary, which gained +1.59%, Utilities, which gained +1.43%, and Communication Services, which gained +1.37%. Meanwhile, the worst-performing sectors were Information Technology, which fell -0.22%, Financials, which gained +0.09%, and Real Estate, which gained +0.2%.
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Last Night’s Performance
Last Night’s Exchange Rates, Prices, & Yields
- CNY per USD 7.12 versus 7.12 yesterday
- CNY per EUR 7.69 versus 7.70 yesterday
- Yield on 10-Year Government Bond 2.15% versus 2.12% yesterday
- Yield on 10-Year China Development Bank Bond 2.22% versus 2.12% yesterday
- Copper Price +0.22%
- Steel Price +0.54%