ASIA STOCKS: China & HK Equities Mixed As China Returns From LNY
As China returns from LNY markets are trading mixed. The CSI 300 is trading 0.20% lower, while small-cap indices are performing better with the CSI 1000 & 2000 trading about 1% higher. Hong Kong listed equities are performing worse with the HSI down 1.20%, HS Tech Index is -1.60%, while the Mainland Property Index trade -1.30%.
- Chinese Travel & Tourism: Airline and travel stocks declined, with China Southern and Air China down ~4%, and Trip.com falling ~5%. However, regional tourism data was positive—Guangdong saw 80m visitors with ¥74b in tourism revenue (+7.5% YoY), Shanghai had 17.8m tourists (+6.1% YoY), and Beijing's retail sales from restaurants and stores hit ¥8.1b (+4.2% YoY).
- E-commerce & Logistics Hit by US Postal Suspension: Alibaba fell 2.1%, JD.com dropped 5.1%, and SF Holding declined as the US halted inbound parcels from China & Hong Kong, adding uncertainty to the sector.
- Sector-Specific Moves: Tungsten stocks gained 3%+ after China imposed export controls, while genetic sequencing firms rose after Beijing blacklisted US company Illumina. AI-related stocks surged, with Iflytek up 8.5%, TRS Information rising 20%, and Beijing Kingsoft up 18%.
- Hong Kong Selling Pressure: The Hang Seng China Index fell 1.8%, with HK$2b ($257m) in mainland investor selling. Maoyan Entertainment dropped 14% despite record Chinese New Year box office numbers, while Enlight Media surged 20%.
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AUD: A$ Stronger But Off Intraday Highs
Aussie is stronger today helped by better risk appetite and softer CNH trends. AUDUSD is up 0.2% to 0.6226, off the intraday high of 0.6240. It fell to 0.6208 early in today’s trading. The USD index is off its low to be little changed.
- With the better risk tone, AUDNZD is up only 0.1% to 1.1082. However, AUDJPY is 0.4% higher at 98.17, close to the intraday high of 98.30. AUDEUR is up 0.2% to 0.6040 and AUDGBP +0.1% to 0.5008 after falling briefly below 0.5000 early in the session.
- The final December S&P Global composite PMI was revised up 0.3pp to 50.2, the third straight month at this level and signalling only slight growth in activity which is being driven by the services sector. The services PMI was revised up 0.4pp to 50.8 to be 0.3pp higher than November.
- Equities are mixed with the ASX up 0.1% and Hang Seng/CSI flat but Nikkei down 1.1% as it catches up after being closed several days. The S&P e-mini is 0.1% lower. Oil prices continue to climb with WTI +0.3% to $74.18/bbl. Copper is up 0.2% and iron ore has given up gains to be back around $99/t.
- Later the Fed’s Cook speaks. US & European December services/composite PMIs and preliminary December German CPI data are released.
MNI: CHINA PBOC CONDUCTS CNY14.1 BLN VIA 7-DAY REVERSE REPOS MON
- CHINA PBOC CONDUCTS CNY14.1 BLN VIA 7-DAY REVERSE REPOS MON
CANADA: Local Media Report Trudeau Will Resign This Week
Headlines have crossed from the Globe and Mail that Canadian PM Trudeau will resign this week. The reports note that the resignation could happen later today, but that it is expected to happen before a national caucus meeting on Wednesday (see this BBG link for more details).
