CLN
Main news
Asian stocks were mostly higher overnight as global markets regained calm after a week of geopolitical turmoil.
Steel stocks were relatively unaffected after Biden’s tariff proposals. Some analysts say this is because the United States remains a relatively small market for Chinese steel producers. In my view, this is a campaign position and may be withdrawn. It is surprising that we are still talking about raising tariffs in the United States, even though Americans are facing the highest inflation rates in over a decade. Remember that customs duties are usually regressive taxes calculated by foreign exchange and ultimately have little impact on actual trade flows. Smoot and Hawley did not go down very well in history. As always, this is a distraction technique.
JD.com announced that it repurchased $1.2 billion worth of its own shares in the first quarter, representing nearly 3% of its outstanding shares. The company also launched a new share buyback program. The program will run through 2027 and include share buybacks worth a total of approximately $3 billion. JD.com remains down -0.71% in Hong Kong overnight, but is trading nearly flat in the US today.
Hong Kong has rebounded after underperforming the mainland in recent trading. Financial stocks were the top performers in the mainland and Hong Kong, supported by positive policy signals. Real estate in Hong Kong also performed well. Home appliance manufacturers have also recently rebounded on hopes that demand will increase due to incentives announced at the “Two Sessions” policy meeting for trade-in and upgrade of large household items such as furniture, electronics, and cars.
Both the Hang Seng Index and the Hang Seng Tech Index closed up +0.80% and +0.50%, respectively, with volume down -4% from yesterday. Overnight, mainland investors bought a net $848 million worth of Hong Kong-listed stocks and ETFs through Southbound Stock Connect. The best-performing sectors were Financials, up +0.62%, Real Estate, up +1.29%, and Consumer Staples, up +1.24%. Meanwhile, the worst performing sectors were Healthcare -0.97%, Energy -0.19% and Utilities +0.13%.
Shanghai, Shenzhen, and STAR Board diverged, with volume increasing +3% from yesterday, closing at +0.09%, -0.11%, and -0.69%, respectively. Overnight, foreign investors sold $734 million worth of mainland-listed stocks through Northbound Stock Connect. The best-performing sectors were Financials, up +0.93%, Materials, up +0.67%, and Consumer Goods, up +0.63%. Meanwhile, the worst performing sectors were utilities -1.27%, energy -1.01% and healthcare -0.70%. CNY still maintains his position at 7.24 per US dollar. Government bonds rebounded slightly. Copper rose, but steel fell.
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last night’s performance
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Last night’s exchange rates, prices and yields
- CNY/USD 7.24 vs. 7.24 yesterday
- Chinese Yuan/Euro 7.72 compared to yesterday’s 7.72
- The daily government bond yield was 1.37%, yesterday it was 1.40%.
- The 10-year government bond yield is 2.25% (2.26% yesterday)
- National Development Bank of China 10-year bond yield 2.32% (2.34% yesterday)
- Copper price +1.62%
- Steel price -0.19%
