Asian equities were mixed overnight, with US stocks falling due to hot US inflation, reinforcing the higher-for-longer narrative. India, Indonesia, Malaysia, and Pakistan were closed for Eid al-Fitr. China’s March CPI was lower than expected, with PPI meeting expectations. Investors expect policy support in response to weak domestic consumption and real estate concerns. The Hang Seng and Shanghai indexes opened lower but managed to climb from intra-day lows, with Hong Kong seeing significant buying activity in stocks and ETFs.
The PBOC is defending CNY against the strong US dollar as market sentiment remains positive despite negative headlines surrounding real estate and company additions to an entity list. The Hang Seng and Hang Seng Tech indexes fell slightly on decreased volume, with large caps and value stocks outperforming small caps and growth stocks. Southbound Stock Connect volumes were moderate, with mainland investors buying a healthy amount of Hong Kong stocks. Shanghai, Shenzhen, and STAR boards all gained on moderate volume, with sectors like communication, industrials, and discretionary performing well.
Upcoming webinars on China’s Q1 performance and investment strategies are set to take place, with topics including consumer rebound and normalization strategies. Last night’s performance saw CNY per USD at 7.23, CNY per EUR at 7.76, and yields on government bonds slightly lower. Copper prices fell while steel prices increased. Key market movers included Changan Automobile’s strong performance on March auto sales and Tencent’s share buyback, among others. Overall, market sentiment remains positive despite concerns over inflation and global cooperation.
