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Asian equities saw mixed performance overnight amid continued Middle East tensions, with Mainland China’s Shanghai and STAR 50 indexes standing out as top performers. Mainland indexes started lower but steadily gained ground throughout the day, with Shanghai closing more than 1% higher. The Northbound Stock Connect experienced a significant inflow of over $1 billion, reversing the net outflow from the previous Friday. The State Council issued “9 Key Points” aimed at improving China’s capital markets, including measures to control IPO supply, encourage dividends, and boost corporate governance and equity allocations of bank and trust products.

In Hong Kong, markets were mostly lower, although defensive and value sectors saw gains. Financials saw a sharp increase following an announcement from Central Huijin Investments about increasing holdings of Mainland bank stocks. However, Apple supplier Sunny Optical fell over 3% in response to Apple reporting a 10% decline in iPhone shipments globally in the first quarter. Japan also reported weak machinery orders and industrial production numbers, reflecting a broader slowdown in global trade. Mainland-listed CRRC gained significantly on positive profit guidance, indicating the impact of infrastructure stimulus measures in the equity market.

The Hang Seng and Hang Seng Tech indexes closed lower, with volume declining compared to the previous day. Mainland investors bought almost $900 million worth of Hong Kong-listed stocks and ETFs through Southbound Stock Connect. Energy, Industrials, and Financials were the best-performing sectors, while Communication Services, Health Care, and Consumer Discretionary sectors saw declines. In Mainland China, Shanghai, Shenzhen, and the STAR Board showed mixed performance, with foreign investors buying over $1 billion worth of Mainland-listed stocks via Northbound Stock Connect. Energy, Industrials, and Consumer Staples were top-performing sectors, while Real Estate, Consumer Discretionary, and Materials lagged behind.

Looking ahead, investors are invited to join webinars focusing on China Q1 Review and investment strategies, as well as discussions on the normalization process in the current economic environment. Overall, the Asian markets are navigating various challenges, including global trade slowdowns and geopolitical tensions, while also benefiting from government stimulus measures and improving corporate governance policies. As investors seek out opportunities in the region, staying informed about key developments and market trends will be crucial in making informed investment decisions.

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