Asian equities had a mixed week, with Mainland China performing well as South Korea and Japan underperformed. The electric vehicle ecosystem saw significant activity, with BYD reporting strong sales and Xiaomi entering the space. In diplomatic news, President Biden and President Xi had a conversation described as “candid and constructive,” focusing on the “San Francisco Vision.” Economic indicators such as the Caixin Services PMI and manufacturing PMIs also showed positive results.
In terms of key news, Hong Kong saw slight declines in the Hang Seng and Hang Seng Tech indexes, with investors reacting to comments by Minneapolis Fed President Neel Kashkari regarding potential interest rate cuts in 2024. The markets in Mainland China, Pakistan, and Taiwan were closed for various holidays. Janet Yellen’s comments on China’s overcapacity in electric vehicles and solar attracted attention during her visit to Guangzhou, where she met with Vice Premier He Lifeng.
Trade talks between China and the US continued, with three days of meetings between officials from both countries focusing on clean energy technology and trade. Hong Kong’s most heavily traded stocks included Tencent, Alibaba, AIA, Meituan, and HSBC, with mixed performances in the internet sector. Energy and healthcare sectors experienced weakness, while real estate was also down. However, Hong Kong ended the week higher, with Chinese tech outperforming US tech by 12% since February 5th.
The Hang Seng and Hang Seng Tech indexes saw slight declines, with volume down from Wednesday. The growth factor and large caps performed better than the value factor and small caps, with Communication Services being the only positive sector. Health Care, Energy, and Utilities sectors were among the worst performers, with consumer durables, software, and media among the top-performing subsectors. Southbound Stock Connect was closed, and Shanghai, Shenzhen, and the STAR Board were also closed.
Looking ahead, a webinar on Quadratic Capital is scheduled for Wednesday, April 24th, focusing on the normalization of markets. Investors can register for the webinar to gain insights into market trends. Additionally, new content is available on Nvidia’s rise fueled by chip giants TSMC and SK Hynix. Mainland China’s fixed income, commodity, and currency markets were closed overnight, further contributing to the mixed performance of Asian equities throughout the week.
