Asian equities were higher overnight, with Mainland China reopening following its Labor Day holiday. Japan, South Korea, and Thailand were closed for various holidays. The Ministry of Culture and Tourism reported an increase in domestic travel in China, with a year-on-year increase in total travel and spending. Real estate policy support continues to be amplified, with Shenzhen following Beijing’s move in clarifying home purchase restriction adjustments. Hong Kong saw choppy morning trading but closed near intra-day highs on high volumes.
Mainland investors were active in Hong Kong via Southbound Stock Connect, buying a healthy net $650 million worth of Hong Kong-listed ETFs and stocks. The most heavily traded stocks in Hong Kong included Tencent, Meituan, Alibaba, CNOOC, and AIA. Mainland China reopened with Shanghai and Shenzhen rising on strong breath and good volume. Foreign investors bought a healthy net $1.29 billion worth of Mainland stocks, including Kweichow Moutai.
President Xi arrived in France for trade talks with President Macron. Geely Automobile is looking to pursue an IPO of its electric vehicle brand Zeekr in the US. Berkshire Hathaway’s annual shareholder meeting is a big event for Chinese investors, with many making the pilgrimage to Omaha. The Hang Seng and Hang Seng Tech indexes gained on increased volume, with the value factor outperforming the growth factor. The top-performing sectors were Utilities, Industrials, and Health Care, while Real Estate fell. Southbound Stock Connect volumes were light as Mainland investors bought a net $650 million worth of Hong Kong-listed stocks and ETFs.
Shanghai, Shenzhen, and the STAR Board saw gains on positive factors, with all sectors performing well. Northbound Stock Connect volumes were light, with foreign investors buying a healthy net $1.29 billion worth of Mainland stocks. CNY and the Asia Dollar Index were higher versus the US dollar. Last night’s exchange rates, prices, and yields showed a decrease in CNY per USD and per EUR, as well as fluctuations in bond yields and commodity prices like copper and steel.
Overall, the Asian equities market showed positive trends, with increased activity in Mainland China and Hong Kong. Policy support in the real estate sector continues to drive market movements, with foreign investors showing interest in Chinese stocks. President Xi’s trade talks in France, along with Geely Automobile’s IPO plans, indicate ongoing developments in the market. The performance of key indexes and sectors in Hong Kong and Mainland China suggests a positive outlook, with factors like value outperforming growth and all sectors performing well.
