^HSI - HANG SENG INDEX
| Previous close | 26,323.69 |
| Open | 26,529.95 |
| Volume | 0 |
| Day's range | 26,300.08 - 26,544.65 |
| 52-week range | 24,896.87 - 30,280.12 |
| Avg. volume | 1,623,130,700 |
- FX Empire
Asia Pacific Shares Mixed: Violence Pressures Hang Seng, Weak Data Drives Shanghai, Nikkei Lower, Aussie Stocks Rise on Rate Cut Hopes
Protests in Hong Kong drove the Hang Seng Index down 4.79% last week with a violent turn Monday. China’s industrial output grew significantly slower than expected in October. The Nikkei was pressured by a report that showed growth in Japan’s economy ground to a near standstill in the third quarter. Shares in Australia were unpinned last week after disappointing October jobs data raised the chances of another rate cut by the Reserve Bank of Australia (RBA) in the coming months.
- FX Empire
Asian Shares Firm after Kudlow Says Phase One Trade Talks in Final Stages
Later on Thursday, White House economic adviser provided another ray of hope when he said negotiations over the first phase of a trade agreement with China were coming down to the final stages, with the two sides in close contact.
- Bloomberg
Protesters Gather in Central for Fifth Day: Hong Kong Update
(Bloomberg) -- Hong Kong protesters returned to the central financial district on Friday, the fifth-straight day of rallies in a broader democracy push that’s driven Asia’s premier financial hub toward recession.The Chinese President Xi Jinping said that bringing the violence to an end is Hong Kong’s “most urgent task,” while a scuffle involving the city’s justice secretary and the second protest-related death in a week heightened tensions. The rare comments by Xi during a visit to Brazil on Thursday came as the U.S. Senate moved to expedite passage of legislation that would support Hong Kong’s pro-democracy protesters.Earlier, a 70-year-old government contract worker who was struck during a brick-hurling fight between protesters and their opponents died of his injuries. Police classified the death as a murder.The protests, which have raged for more than five months, flared anew last week after the death of a student who fell near a police operation to clear a demonstration. A campaign to disrupt traffic has led to the shooting of a protester and citywide school cancellations, while Chief Executive Carrie Lam’s government has denied reports of a plan to institute an unprecedented curfew in a bid to quell unrest.Key developments:City’s No. 2 calls media briefing Protesters return to city’s streetsHong Kong justice minister hurt in LondonXi urges immediate end to violenceGovernment worker dies; 15-year-old still in hospitalSome trains services remain suspendedHere’s the latest (all times local):City’s No. 2 to brief media (5:06 p.m.) Hong Kong’s No. 2 official Matthew Cheung called a briefing for 6 p.m. Friday, as the city seeks to break free from the latest wave of protests. The chief secretary will be joined by Civil Service Secretary Joshua Law, Transport Secretary Frank Chan, Education Secretary Kevin Yeung and Constitutional and Mainland Affairs Secretary Patrick Nip. Protesters gather in Chater Garden (5 p.m.)Demonstrators began gathering again in Chater Garden in the city’s central financial district, after dispersing earlier following the arrival of riot cops. Police said they had arrested 58 people since Thursday. They fired 194 rounds of tear gas, 58 rubber bullets and 14 bean bag rounds.Overwhelming support for inquiry (4:45 p.m.)Some 80% of Hong Kong adults want the government to set up an independent commission of inquiry to examine the use of force by police throughout Hong Kong’s recent unrest, according to a new survey by Hong Kong Public Opinion Program. That’s up from 77% earlier this month.An inquiry is one of the five demands that protesters have been chanting about in marches throughout the city for months, but the government has so far ruled out any further political concessions.Hong Kong expects recession (4:30 p.m.)Hong Kong revised down its estimate for economic growth this year, with the government now forecasting the first annual contraction since the global financial crisis a decade ago. Gross domestic product will contract 1.3% in 2019 from the previous year, the government said Friday as it released final output calculations for the third quarter.The government said ending the city’s violent unrest is key to an economic recovery.Police classify death as murder (1:31 p.m.)Police upgraded their probe into the injury of a 70-year-old government worker to a murder investigation after the man died overnight. The man was struck in the head by an object during a scuffle Wednesday between protesters who had set up road blocks and others who were attempting to clear them.The man appeared to be filming in the direction of a group of black-clad protesters when one of them “deliberately threw” an object at him, Chan Tin-chu, senior superintendent for criminal investigations in New Territories North, told reporters at a briefing Friday. The victim didn’t participate in the argument or the attempt to clear the road blocks, Chan said.Protesters start lunchtime rallies (12:40 p.m.)Groups of protesters begin gathering in the financial district for a lunchtime rally, one of several planned across the city. Many wore masks and carried umbrellas.Protesters also began assembling in the bustling Causeway Bay shopping district and in Tai Koo, on the eastern side of Hong Kong Island.Chinese officials condemn attack (12:15 p.m.)The Chinese government raised strong objections to the U.K. consulate in Hong Kong regarding the attack on the city’s justice secretary in London on Thursday. The Office of the Commissioner of the Chinese Ministry of Foreign Affairs in Hong Kong also urged the U.K. government and police to punish those responsible for the attack on Teresa Cheng, according to a statement.Hurt 15-year-old still in hospital (8:56 a.m.)A 15-year-old boy who suffered a head injury from what local media said may have been a tear gas canister was still in Tuen Mun Hospital, the Hospital Authority said. The agency said the boy’s family asked that details of his condition -- which was originally listed as critical -- not be disclosed.Six people, ages 17 to 62, had been admitted to various hospitals for treatment for protest-related injuries overnight and this morning as of 7:30 a.m. All are in stable condition. The man shot by police in Sai Wan Ho on Monday is now in stable condition in Eastern Hospital. A man set on fire during an argument with protesters on the same day was still in critical condition at Prince of Wales Hospital.Group blames government for death (7:32 a.m.)A group of anonymous protesters that has occasionally spoken for the leaderless movement expressed “deepest condolences” for the death of a 70-year-old government worker Thursday, but blamed the incident on “police brutality” and government intransigence. “The HKSAR Government must concede to the Five Demands, and return to the table of politics to solve conflicts by political means,” the so-called Citizens’ Press Conference said in a statement Friday.Meanwhile, another protester group at the Chinese University of Hong Kong offered to remove barricades from the Tolo Highway in exchange for a government pledge to follow through with plans for District Council elections on Nov. 24, according to Radio Television Hong Kong. Students had already reopened one lane in each direction, the South China Morning Post said.Some trains still suspended (5:55 a.m.)Service between Fo Tan and Lo Wu and Lok Ma Chau on the East Rail Line are suspended due to vandalism, railway operator the MTR Corp. said Friday. Trains between Hung Hom and Fo Tan on the same line are running every five minutes. Stations at Mong Kok, Tseung Kwan O, Sai Wan Ho, Tuen Mun and Tung Chung also remain shut.Justice secretary ‘attacked’ (3:47 a.m.)Hong Kong Justice Secretary Teresa Cheng condemned what her office said was an attack by a “violent mob” that caused her “serious bodily harm” Thursday while she was on an official visit to London. Cheng fell and hurt her arm after being surrounded by a group of about 30 protesters, the South China Morning Post newspaper reported.“The secretary denounces all forms of violence and radicalism depriving others’ legitimate rights in the pretext of pursuing their political ideals, which would never be in the interest of Hong Kong and any civilized society,” Cheng’s office said in a statement.Agency ‘saddened’ by death (2:21 a.m.)Hong Kong’s Food and Environmental Hygiene Department confirmed that one of its contract workers had died Thursday from a head injury, expressing “profound sadness” over his death. The elderly worker “was suspected to be hit in his head by hard objects hurled by rioters during his lunch break,” the agency said in a statement, adding that it would provide assistance to the victim’s family.The government vowed to “make every effort to investigate the case to bring offenders to justice.”U.S. Senate advances bill (12:41 a.m.)The U.S. Senate is preparing for quick passage of legislation that would support pro-democracy protesters by placing Hong Kong’s special trading status with the U.S. under annual review. The Senate will run the “hotline” on the bill, which is an expedited process to check for last-minute opposition to bringing legislation immediately to a vote, according to Senator Marco Rubio, a Florida Republican.The Senate legislation is different than a version passed earlier by the House of Representatives. That means the two bills would have to be reconciled and passed by both chambers before going to President Donald Trump to be signed into law.Xi seeks end to violence (10:25 p.m. Thursday)Xi, currently on a visit to Brazil, said “continuing radical violent crimes in Hong Kong have seriously trampled on the rule of law and social order, seriously undermined Hong Kong’s prosperity and stability, and seriously challenged the bottom line of the ‘one country, two systems’ principle,” state broadcaster China Central Television reported in a social media post.“Stopping the violence and restoring order is Hong Kong’s most urgent task at present,” Xi said, reiterating support for Lam. “We will continue to firmly support the chief executive to lead the government of the Hong Kong Special Administrative Region in accordance with the law, firmly support the Hong Kong Police in law enforcement, and firmly support the Hong Kong judiciary in punishing violent criminals.”\--With assistance from Erin Roman, Daniel Flatley, Colin Keatinge and Dandan Li.To contact the reporters on this story: Iain Marlow in Hong Kong at imarlow1@bloomberg.net;Natalie Lung in Hong Kong at flung6@bloomberg.net;Dominic Lau in Hong Kong at dlau92@bloomberg.netTo contact the editor responsible for this story: Brendan Scott at bscott66@bloomberg.netFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
- Financial Times
Chinese students abandon Hong Kong
Protesters blocked roads and metro lines were suspended for a fourth day in Hong Kong after police laid siege to a leading university, triggering an exodus of mainland Chinese students from the territory. In a statement, Beijing said “mob behaviour would not be tolerated”. ”, officers fired water cannon, tear gas and rubber bullets at students at the Chinese University of Hong Kong.
- Bloomberg
Hong Kong Crippled Again as Anxiety Builds Over China’s Next Move
(Bloomberg) -- Hong Kong was left crippled for a fourth straight day, as protests paralyzed parts of the city and residents questioned how much longer they could endure the disruptions.The unrest on Thursday prompted companies to tell employees to work from home while some train lines were suspended, major events were canceled and public schools were closed through Sunday. Speculation spread about measures the government might take to stop the violence after Chief Executive Carrie Lam held a late-night meeting on Wednesday with top officials.The disruption of a complete work week marked an escalation in pro-democracy protests that started in June against a bill that would allow extraditions to China for the first time. The violence this week led to clashes in the main Central financial district and prompted several top universities to cancel or amend classes for the remainder of the semester.Markets were rattled Thursday after China’s state-run Global Times tweeted that Hong Kong was expected to impose a curfew for the weekend to curtail the violence. While the paper deleted its tweet not long after it was posted, the Hang Seng Index fell to its lowest close in a month.Pro-democracy lawmaker Claudia Mo called the report of a curfew “fake news,” while Lam’s office didn’t immediately respond to an emailed request for comment. Chief Superintendent Tse Chun-chung said the Hong Kong police weren’t in a position to comment on curfews as the authority to direct a curfew order rests with the chief executive.It’s unclear how effective a curfew would be at keeping protesters home and quelling the unrest -- and whether the police force has the manpower to fully enforce it. A face mask ban implemented last month using emergency powers failed to quell the unrest, and hasn’t been widely enforced.The city’s No. 2 official, Matthew Cheung, said Thursday that Lam’s late-night meeting had no specific purpose and was held later than usual to accommodate attendees’ busy schedules, Radio Television Hong Kong said. He said the government supplemented its police force with some 100 officers from the Hong Kong Correctional Services Department to serve as “special police” on a voluntary basis.Secretary for Security John Lee told the Legislative Council that Hong Kong hasn’t used army or police forces from mainland China but didn’t rule the option out. When asked to clarify the statement later, a spokeswoman for the security bureau didn’t address employing police from mainland China and referred to the earlier decision to appoint Hong Kong’s correctional officers.Citywide ClosuresMeanwhile, clashes persisted at universities in Hong Kong, with some schools in Sweden and the U.K. urging their students to come home. Police fired tear gas earlier Thursday near Hong Kong Polytechnic University in Kowloon, which said along with the University of Hong Kong that it would cancel most classes for the rest of the semester.“We don’t know when we can open the university again because of the traffic disruptions and damage to school property,” PolyU spokeswoman Eunice Ol Cheng said. “We understand that some foreign students will need to go home due to the current situation.”There was also a flurry of announcements for closures and cancellations of conferences, concerts and other events -- including a large industry airline conference hosted by Cathay Pacific Airways Ltd. That’s likely to further dent the city’s all-important tourism and retail sectors, which have already been hit by months of unrest.The value of Hong Kong’s retail sales tumbled 18% year-on-year in September, based on the latest official data available, while visitor numbers dropped 34%. The government is due to release final third-quarter economic data Friday afternoon, and a 2.9% contraction is expected.‘Very Worrisome’“What we are witnessing is very worrisome,” said Yiu Si-wing, a pro-establishment lawmaker from the tourism sector.Bystanders are getting caught in the fray, with a 10-month-old baby among the 67 people admitted to the hospital as a result of the clashes. On Wednesday, police arrested 224 people aged between 14 and 69, and fired 578 rounds of tear gas, Senior Superintendent Kong Wing-cheung said Thursday at a regular police briefing.“We kept asking the government to use political solutions to solve the problem, but they just used police confrontation and the result is that hatred has been accumulated to a level that it’s now hard to bring down,” said Ivan Choy, a politics professor from the Chinese University of Hong Kong. “I don’t see a way out.”\--With assistance from Will Davies, Blake Schmidt, Natalie Lung and Dominic Lau.To contact the reporters on this story: Shelly Banjo in Hong Kong at sbanjo@bloomberg.net;Iain Marlow in Hong Kong at imarlow1@bloomberg.netTo contact the editors responsible for this story: Daniel Ten Kate at dtenkate@bloomberg.net, Karen LeighFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
- Bloomberg
U.S. Stocks Edge Higher; Bonds, Dollar Advance: Markets Wrap
(Bloomberg) -- U.S. stocks edged higher, stalling below all-time highs as investors remained skittish about whether the U.S. and China will be able to hash out a partial trade deal. The dollar and Treasuries rose.The S&P 500 eked out its second straight gain, treading just under its record reached as part of a more than 7% rally since the start of October, fueled by trade hopes, waning recession fears and rate cuts. Tech shares gyrated after a report said farm purchases have become another of several issues in negotiations between the world’s two largest economies. The Dow Jones Industrial Average reached a record as Walt Disney Co. surged following the debut of its streaming service.The 10-year Treasury yield fell the most in more than a week, while the dollar rose for the seventh time in eight sessions to the highest in a month. The yen advanced along with gold. West Texas crude rose to $57 a barrel.“There was a mild optimism in the market today fueled by hopefulness about the consumer. On the other hand, the whole trade tariff thing doesn’t seem to be any closer to a resolution,” said John Carey, portfolio manager at Pioneer Investment Management Inc. “That uncertainty is still out there, but at this point people have gotten used to that uncertainty. A continued non-resolution isn’t a new negative, it’s just part of the landscape we’ve been watching.”The prospect of a deal between the world’s two biggest economies has become key to sustaining a rally that drove American stocks to records, as it appears the Fed will be on the sidelines for a long time. The U.S. and China have yet to announce a new location or time to seal the agreement after an international gathering in Chile was canceled, and it’s unclear whether Trump’s renewed threats will move things forward.Elsewhere, emerging-market shares fell as Hong Kong’s benchmark stocks gauge slumped as the city endured a third day of unrest. Japanese shares retreated along with those in South Korea and Australia. New Zealand’s dollar jumped after the country’s central bank unexpectedly kept interest rates unchanged.Here are some key events coming up this week:Earnings season is slowing. Reports are due this week from companies including Japan Post Bank, Walmart, and Cisco.U.S. CPI and earnings data Wednesday may provide more clues on the Fed’s policy pathThursday brings China retail sales and industrial production data.U.S. retail sales on Friday are forecast to rebound in October after unexpectedly falling the prior month.These are the main moves in markets:StocksThe S&P 500 Index rose 0.1% at 4 p.m. New York time.The Stoxx Europe 600 Index declined 0.3%.The U.K.‘s FTSE 100 Index declined 0.2%.The MSCI Emerging Market Index sank 1.2%.CurrenciesThe Bloomberg Dollar Spot Index gained 0.1%.The euro was little changed at $1.1005.The British pound was little changed at $1.2838.The Japanese yen rose 0.2% to 108.84 per dollar.BondsThe yield on 10-year Treasuries sank five basis points to 1.88%.Britain’s 10-year yield dipped five basis points to 0.75%.Germany’s 10-year yield declined five basis points to -0.299%.Japan’s 10-year yield fell two basis points to -0.042%.CommoditiesWest Texas Intermediate crude rose 0.7% to $57.23 a barrel.Gold climbed 0.5% to $1,463.99 an ounce.\--With assistance from Robert Brand and Vildana Hajric.To contact the reporters on this story: Randall Jensen in New York at rjensen18@bloomberg.net;Claire Ballentine in New York at cballentine@bloomberg.netTo contact the editor responsible for this story: Jeremy Herron at jherron8@bloomberg.netFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
- Financial Times
Hong Kong stocks hit as protest violence deepens
Hong Kong stocks extended their decline for the week to almost 4 per cent on Wednesday as violent clashes between protesters and police previously limited to weekends spilled onto the streets of the city’s central financial district, darkening investor sentiment. The Hang Seng index ended the day down 1.8 per cent, taking the equities benchmark down 3.9 per cent for the week.
- FX Empire
Rising Tensions in Hong Kong Drive Equities Lower
The closing of US equities at record highs on Friday did not seem to influence the market’s direction in Asia this morning.
- FX Empire
Asian Shares Lower; Hong Kong Violence Escalates; Alibaba Breaks Singles Day Record
Chinese e-commerce giant Alibaba set a new sales record on Singles Day, the world’s largest 24-hour shopping event. The S&P;/ASX 200 Index posted its highest closing price since August 1, the same week it reached an all-time high closing value of 6845.
- Bloomberg
Hong Kong’s $530 Billion Stock Rally Buckles as Protests Worsen
(Bloomberg) -- Hong Kong stocks fell the most since early August as protests escalated after police shot and wounded a protester on Monday morning.The Hang Seng Index dropped 2.6%, with local landlords plummeting. Police fired tear gas in the center of the business district to disperse chanting office workers who were blocking roads. Signs that optimism over a potential U.S.-China trade deal has been overdone added to the bearish sentiment. The MSCI Hong Kong Index slumped 2.9% and the local dollar weakened.The abrupt drop in the city’s stocks -- the worst in Asia -- follows a half trillion dollar rally that drove a measure of buying momentum to its highest level in almost nine months and pushed the Hang Seng Index above its 200-day moving average.The shooting came as protesters called for a city-wide strike following the death of a student who fell from a parking garage amid a police dispersal operation. The city’s railway operator suspended parts of some lines amid mass vandalism and universities canceled classes. Police had earlier said two protesters were shot.“Hong Kong safety is now a big question,” said Jackson Wong, asset management director at Amber Hill Capital. “Some people are worried that today’s event would escalate the protest. There’s also conflicting messages from the U.S. and China over the trade deal. Last week people were pricing in a successful deal.”The local dollar fell 0.04% to 7.8334 per greenback after its best week since mid-September. That’s even as a gauge tracking the demand for cash jumped to the highest level since early 2016. The currency’s three-month forward points surged to 75.Concern is also rising that Hong Kong’s bleak economic situation has yet to fully filter through to its stocks. Faced with its worst business outlook since the 2008 financial crisis and a plunge into recession, a chill may be coming for Hong Kong’s corporate earnings. He Qi, a fund manager with Huatai Pinebridge Fund Management Co. who called the rally in mid-August, says he’s preparing to sell.“Hong Kong’s gains are just part of a global risk-on rally amid a flood of liquidity, and the short-term gains are way too strong,” said He.While President Donald Trump said late last week that trade talks with China were moving along “very nicely,” he added that reports about how much the U.S. was ready to roll back tariffs on China were “incorrect.” Those reports had helped fuel the risk-on rally that sent a gauge of global stocks to its highest level since early 2018.China’s largest brokerage Citic Securities Co. earlier this month trimmed its earnings growth forecast on the Hang Seng gauge to 4% this year from a previous estimate of as much as 8%. The continuing protests in the city and the impact on commercial property, retail and tourism industries has gone beyond expectations, strategists led by Yang Lingxiu wrote in a note dated Nov. 4.Swire Pacific Ltd. plunged 5.2% at the close. Wharf Real Estate Investment Co. sank 4.5%, and New World Development Co. lost 4.2%.City workers and tourists ran into shopping malls and office lobbies after riot police fired rounds of tear gas in the heart of the Central business district, just blocks from the stock exchange.The city’s stock market will remain open as usual, Hong Kong Exchanges & Clearing Ltd. spokesman Jeffrey Ng said in a email.To be sure, traders can still find opportunities in a market where many firms rely on the mainland for earnings. China’s A shares are about 28% more expensive than their Hong Kong listed peers, compared with a long-term average of 20%.The recession will likely make its presence felt in earnings for this year and in the first quarter of 2020, said Ken Chen, a Shanghai-based strategist with KGI Securities Co.“There’s no end in sight to the local unrest and expectations of an economic recovery next year remain low,” he said. “Hong Kong is just rising along with global markets, and the gains will pause when the global rally weakens.”\--With assistance from Cindy Wang, Jeanny Yu and Philip Glamann.To contact Bloomberg News staff for this story: Amanda Wang in Shanghai at twang234@bloomberg.netTo contact the editors responsible for this story: Sofia Horta e Costa at shortaecosta@bloomberg.net, David WatkinsFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
- FX Empire
Asian Shares Weaken as Tariff Rollback Optimism Softens
China’s exports and imports declined in October, Reuters reported citing data from the country’s customs released on Friday. In dollar terms, exports fell 0.9% while imports fell 6.4% from a year ago in October, but beat analysts’ forecasts.
- Financial Times
US stocks close at record highs on signs of trade war thaw
Wall Street’s three main equities gauges closed at simultaneous record highs, and Treasury bonds sold off, following reports the US and China agreed in principle to remove some tariffs imposed during their trade spat. Bonds sold off, driving yields higher, as investors became more optimistic a resolution to the trade deal would revive global economic growth.
- Market Realist
Shanghai Composite Rises on Trade Deal Optimism
Both the Shanghai Composite Index and the Hang Seng Index closed with gains today. Also, Asian markets were in the green from the recent momentum.
- Financial Times
US equities hit record on optimism over US-China dispute
Fresh optimism on trade negotiations and positive corporate earnings sent US stocks to a new record on Monday and pushed global equities indices higher. The S&P 500 advanced 0.4 per cent, extending last week’s all-time closing high for the index and driving a 22.8 per cent bull run so far this year, while indices in Europe and Asia also edged higher. on Sunday that he was “quite optimistic” the remaining obstacles in the first phase of US trade negotiations with China could be overcome soon, adding that the Chinese and US leaders still planned to meet this month.
- FX Empire
Asian Shares Mixed; Private Survey Shows China’s Manufacturing Expanded
A private survey showed factory activity in China expanded in October with the Caixin/Markit PMI coming in at 51.7. Analysts polled by Reuters had expected the PMI number to come in at 51.0 from 51.4 for September.
- FX Empire
Asia, Europe Present Mixed Reaction to Fed; Fiat, Peugeot Confirm Merger Deal
In China, factory activity contracted for the sixth straight month in October. The official Purchasing Managers’ Index (PMI) came in at 49.3 for October. In the United Kingdom, Prime Minister Boris Johnson and main opposition leader Jeremy Corbyn begin their first full day of campaigning Thursday ahead of what promises to be a historic December election.
- Bloomberg
U.S. Stocks Slip Amid Earnings, Trade Headlines: Markets Wrap
(Bloomberg) -- U.S. stocks ended a lackluster session lower as trade headlines and a spate of corporate earnings weighed on shares ahead of tomorrow’s expected rate cut by the Federal Reserve. Treasuries edged higher.The S&P 500 negative in the final half hour after earlier hitting a fresh record. Health-care shares rose on strong results from Merck and Pfizer. A report that China and the U.S. might not sign a partial deal next month, a day after President Donald Trump’s assertion that negotiations were ahead of schedule, dented stocks exposed to the battle. Lenders got a lift after Treasury Secretary Steven Mnuchin said he’d be open to looser bank rules. Alphabet and Akami earnings dropped the Nasdaq indexes.“The big thing is markets are really trying to figure out how they should feel about earnings -- earnings aren’t coming in as bad as we expected but that still doesn’t mean they’re good,” Shawn Cruz, manager of trader strategy at TD Ameritrade, said by phone. “Investors are trying to figure out where they should be moving right now in light of all the information that we’re getting.”Elsewhere yields on Japanese 10-year bonds hit the highest since June and their Australian counterparts jumped almost nine basis points, yet the sell-off cooled during European hours, with yields on German and U.S. peers halting their recent surge. The pound reversed a drop after the U.K.’s main opposition party said it will back an early election.Investors are struggling for fresh impetus to extend the record-breaking rally in U.S. stocks. Optimism on the China trade front from President Donald Trump is aiding the bull case, and an anticipated Fed rate cut on Wednesday may add further fuel. Still, recent economic data has come in mixed and while earnings are topping estimates on average, the bar was low.Here are some key events coming up this week:Earnings include: Airbus, Apple, Credit Suisse, Facebook and PetroChina on Wednesday; Mitsubishi Heavy on Thursday; Exxon Mobil and Macquarie Group on Friday.The Fed is expected to lower the main interest rate when policy makers decide on Wednesday.U.S. economic growth is forecast to have slowed to 1.6% in the third quarter. GDP data are due Wednesday. The Fed’s preferred inflation metric, the core PCE deflator, is due Thursday.The Bank of Japan sets policy on Thursday and Governor Haruhiko Kuroda will hold a news conference.Friday brings the monthly U.S. non-farm payrolls report.These are some of the main moves in markets:StocksThe S&P 500 Index slipped 0.1% at 4 p.m. New York time.The Nasdaq 100 fell 0.8% and the Dow Jones Industrial Average was little changed.The Stoxx Europe 600 lost 0.2%.Japan’s Topix index climbed 0.9%.India’s Sensex Index surged 1.5%.CurrenciesThe Bloomberg Dollar Spot Index was little changed.The yen rose 0.1% to 108.83 per dollar.Britain’s pound was little changed at $1.2862.The euro added 0.1% to $1.1112.BondsThe yield on 10-year Treasuries declined two basis points to 1.83%.The two-year rate fell one basis points to 1.64%.Germany’s 10-year yield decreased two basis points to -0.35%.CommoditiesThe Bloomberg Commodity Index advanced 0.2%.U.S. natural gas futures surged 6.2%.Gold futures fell 0.3% to $1,492.10 an ounce.West Texas Intermediate crude decreased 0.5% to $55.54 a barrel.\--With assistance from Andreea Papuc and Todd White.To contact the reporter on this story: Vildana Hajric in New York at vhajric1@bloomberg.netTo contact the editor responsible for this story: Jeremy Herron at jherron8@bloomberg.netFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
- FX Empire
Asian Shares Mixed; Hong Kong Bracing for Recession
Embattled Hong Kong leader Carrie Lam said on Tuesday she expected the Asian financial hub to record negative economic growth this year, in part as a result of the unrest, according to Reuters.
- Bloomberg
Hong Kong Bank Profits Seen Falling 67% in JPMorgan's Worst Case
(Bloomberg) -- Months of protests, a worsening economy and a plunge in property prices could translate into severe pain for Hong Kong’s banks, and threatens to end the city’s status as a “safe haven” for customers’ savings, according to JPMorgan Chase & Co.A stress test performed by the U.S. bank projected that local lenders including Hang Seng Bank Co. and Bank of East Asia Ltd. could see earnings slump 24% to 45% next year and 39% to 67% in 2021. That would lead to significant deterioration in return on equity and core capital buffers, analysts led by Jemmy Huang told clients in a note Monday.They downgraded Hang Seng Bank to underweight from neutral and said they are taking a “cautious” view of lenders in the city.“The social unrest in Hong Kong has persisted for more than four months and shows no signs of moderation,” Huang wrote.While the Hong Kong government has laid out policy support including boosting loans to small businesses and cutting banks’ capital buffers to mitigate an economic downturn, “history suggests a sustainable rally would not come through until the underlying issues are resolved,” Huang said. Hong Kong banks probably won’t outperform the benchmark Hang Seng Index in the next six to 12 months, he predicted.Hong Kong may report negative growth this year as the economy reels from the social unrest, Financial Secretary Paul Chan wrote in a blog post on Sunday. Once Asia’s manufacturing powerhouse before the rise of mainland China, Hong Kong’s freewheeling consumer and finance-led economy is vulnerable to a potential collapse in confidence triggered by the turmoil.Declines in residential prices, retail and office rents threaten higher credit costs on mortgages and property loans while potential capital outflow and the monetary authority’s intervention will hurt banks’ net interest margin. Overseas loans, trade finance, and lending to wholesale and retail sectors also could be impacted, JPMorgan said.Hang Seng Bank, controlled HSBC Holdings Plc, is likely to be hit the most among peers due to its higher leverage and concentration of Hong Kong-dollar denominated portfolio, the JPMorgan analysts said. Shares of Hang Seng Bank have lost 6% this year while Bank of East Asia tumbled 23%.BOC Hong Kong Holdings Ltd. may fare better given its sufficient capital position to sustain dividend yields even under stress tests, according to the note.\--With assistance from Alfred Liu.To contact Bloomberg News staff for this story: Jun Luo in Shanghai at jluo6@bloomberg.netTo contact the editors responsible for this story: Candice Zachariahs at czachariahs2@bloomberg.net, David Scheer, Sam MamudiFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
- FX Empire
Asian Shares Post Weekly Gain as Trade Deal Hope Offsets Brexit Uncertainties
Offsetting the fresh concerns over Brexit was an improvement in investor sentiment around ongoing negotiations between the United States and China. The International Monetary Fund released new projections last week that showed growth in Asian economies could be slower than expected.
