Chinese stocks fall in Hong Kong as Asia shuts down for holidays: Markets come full circle

(Bloomberg) — Chinese stocks in Hong Kong fell for a third day in a row as U.S. stocks hit a record high and many markets in the region, including the mainland, observed a public holiday.

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The Hang Seng Chinese Enterprise Stock Index fell by up to 2.5%, and the Hang Seng Index also fell by up to 2.2%. Trading has been choppy in recent days as China seeks to stem a slump in its stock market. And both indicators are now up for the week, thanks to Tuesday’s big gains amid optimism about state aid. Investors have warned that previous efforts to stem the market’s decline, especially in 2015, may not work this time around.

Markets will close early Friday in Hong Kong and Singapore, as well as in mainland China, Taiwan, South Korea, Indonesia, the Philippines and Vietnam.

“After the recent small rally, people are taking a break before Lunar New Year,” said Willer Chen, an analyst at Forsyth Barr Asia. “We are also seeing a bit of a downside today as volume is a little low due to the lack of southward support.”

US futures are little changed. The S&P 500 closed 0.1% higher on Thursday, just below the 5,000 threshold it briefly hit during trading. The closing price level hit a new all-time high. The Nasdaq 100 rose 0.2%.

“Our base case remains a soft landing for the U.S. economy, with the S&P 500 ending the year near current levels,” Solita Marcelli of UBS Global Wealth Management said in a note Thursday. “However, recent economic data highlights the potential for continued strong growth, subdued inflation, and more rapid monetary easing. This event could lift the S&P 500 index to around 5,300 this year. That’s what I think.”

story continues

Meanwhile, back in Asia, China’s efforts to stop a $7 trillion stock market crash are recalling memories of 2015, when the Chinese government took drastic steps to halt the collapse. There is. But this time, investors say the problems run deeper.

“What China needs in terms of a catalyst is a large scale coordinated fiscal easing that targets demand,” Florian Neto, head of Asia multi-asset at Amundi Hong Kong, said on Bloomberg TV. “What we have is market stability, but we are not addressing the fundamental problems of China’s economy.”

Australian stocks were little changed, and Japanese stocks traded within a narrow range, with the weaker yen providing some support. The currency firmed after falling 0.8% against the dollar on Thursday following comments by the Bank of Japan deputy governor suggesting the central bank is in no hurry to change its accommodative policy settings. The dollar index was strong.

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Japan-listed SoftBank Group Corp. rose as much as 10% after its latest quarterly results showed better-than-expected net profit and further gains from Arm Holdings, in which it holds a stake. Nissan shares fell more than 9% after the company missed profit estimates.

In Asian trading, U.S. Treasuries were little changed after falling on Thursday. The selling also came after the U.S. government sold $25 billion of 30-year bonds at lower-than-expected yields in a sign of healthy demand. The 10-year Treasury yield rose 3 basis points on Thursday and rose 13 basis points this week as investors adjusted interest rate expectations in response to strong economic data and comments from central bank policymakers.

Richmond Fed President Thomas Barkin reiterated that the central bank has time to be patient before cutting rates. New figures on Thursday also highlighted the resilience of the U.S. economy. Unemployment claims were slightly below consensus expectations, indicating continued strength in the labor market.

Elsewhere, New Zealand yields and the currency rose after ANZ Bank New Zealand said the central bank expected to raise interest rates two more times this year.

inflation revision

A further shock to interest rate expectations could come later on Friday when the US updates its monthly inflation data. Investors will be watching closely after last year’s update raised questions about the Fed’s progress in curbing consumer prices.

“The CPI revision could throw some cold water on the recent positive inflation numbers, but these are volatile numbers,” said Andrew Brenner of NatAlliance Securities. “I think the next move will be determined by next Tuesday’s CPI numbers,” he said.

Treasury Secretary Janet Yellen also said that U.S. regulators are monitoring risks posed by non-bank mortgage lenders, and that one of them could fail if market tensions arise. I warned you.

Bitcoin has surpassed $45,000. Oil prices rose amid doubts over a possible ceasefire in the Israel-Hamas war.

This week’s main events:

The main movements in the market are:

stock

• S&P 500 futures were little changed as of 11:35 a.m. Tokyo time.

• Nasdaq 100 futures little changed

• Hang Seng futures fell 1.4%.

• Japan’s Topix remains almost unchanged.

• Australia’s S&P/ASX 200 little changed

• Euro Stoxx50 futures fell 0.1%

currency

• Bloomberg Dollar Spot Index little changed

• The euro was almost unchanged at $1.0776.

• The Japanese yen remained almost unchanged at 149.31 yen to the dollar.

• The offshore yuan was almost unchanged at 7.2092 yuan to the dollar.

• The Australian dollar was almost unchanged at US$0.6496.

cryptocurrency

• Bitcoin rose 0.9% to $45,749.61

• Ether rose 0.5% to $2,436.65

bond

• The 10-year Treasury yield fell 1 basis point to 4.14%.

• Japan’s 10-year bond yield rose 1 basis point to 0.710%.

• Australian 10-year bond yield unchanged at 4.11%

merchandise

This article was produced in partnership with Bloomberg Automation.

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