Asian equities were mixed overnight, with China and the Philippines performing well while Japan underperformed. Australia and Hong Kong were closed for Easter Monday. Shanghai and Shenzhen saw strong gains driven by March’s “official” PMIs, which exceeded expectations. The PMI surveys, conducted by different organizations, show expansion in activity. China’s economy is slowly rebounding, with strong manufacturing output and new orders. This is seen as a positive sign for the global economy.
Mainland China’s markets had a strong day despite Stock Connect being closed. The electric vehicle ecosystem performed well ahead of March sales data, with companies like CATL and BYD seeing gains. BYD reported the second-highest monthly sales ever for NEVs in March. Competitors like NIO, Xpeng, and Li Auto also reported strong sales numbers. Meanwhile, Hong Kong’s markets were closed for Easter Monday. In China, the growth factor and small caps outperformed the value factor and large caps. Top-performing sectors included Communication Services, Consumer Discretionary, and Technology.
The STAR Board in China gained significantly, along with Shanghai and Shenzhen markets. Volume was up from Friday, with a majority of stocks seeing gains. The top-performing sectors included Communication Services, Consumer Discretionary, and Technology, while utilities and energy sectors saw losses. Subsectors like office supplies, autos, and household products performed well, while coal, highways, and oil & gas saw declines. The currency and Treasury curve showed some movement, with copper prices rising and steel prices falling.
In terms of performance, the CNY saw minimal movement against the USD and EUR, while government bond yields showed some variation. The Copper price increased, while the Steel price decreased. Investors are advised to read the latest defined outcome article discussing why Microsoft is the largest weighting in a specific index fund. Overall, the recent performance of Asian equities, specifically in China, indicates positive momentum and potential growth in various sectors, including electric vehicles and technology.
