Market Highlights 💡 - 8 October 2024

Rising oil prices and increasing U.S. Treasury yields have put the U.S. market in a difficult position; the Hong Kong Hang Seng Index has risen to a 32-month high.

🇺🇸 S&P 500 Index: -0.96% 📉

🇺🇸 Nasdaq Index: -1.18% 📉

🇪🇺 Stoxx 600 Index: 0.18% 📈

🇯🇵 Nikkei 225 Index: 1.80% 📈

🇭🇰 Hang Seng Index: 1.60% 📈

🇨🇳 CSI 300 Index: 0.00% close

🇸🇬 STI: 0.28% 📈

Wall Street performed poorly on Monday, with the S&P 500 Index and Nasdaq Composite Index dropping -1.0% and -1.2%, respectively, due to rising U.S. Treasury yields. The market adjusted expectations for Federal Reserve interest rate cuts, while escalating conflicts in the Middle East kept traders cautious.

Eurozone retail sales grew by 0.8% year-on-year in August (expected growth of 1.0%), rebounding from July's -0.1% year-on-year drop, reflecting a softening in consumer spending dynamics.

Before the end of China's Golden Week holiday, the Hong Kong Hang Seng Index continued its upward trend, rising 1.6% as Citigroup and Goldman Sachs raised their target prices for Chinese stocks following Beijing's stimulus measures boosting the stock market.

💡 Upcoming Events: 💡

U.S. year-on-year export data will be released on Tuesday.

On Wednesday, the minutes from the U.S. Federal Open Market Committee meeting will be published.

On Thursday, U.S. unemployment claims, year-on-year CPI, and Malaysia's unemployment rate will be closely watched by investors.

At the end of this week, we will see the U.S. preliminary Michigan Consumer Confidence Index and retail sales year-on-year published on Friday, along with China's year-on-year inflation and year-on-year exports released on Sunday.

💡 Things to Know Today: 💡

1. The benchmark 10-year U.S. Treasury yield reached 4%, easing concerns about a recession following strong labor market data and reducing expectations for a Federal Reserve rate cut in November. The market is currently waiting for key U.S. CPI data to be released later this week to assess further market direction.

2. Costco's $Costco(COST)$ 24-karat gold bars generated $100 million in sales last quarter and sold out in 77% of its stores by early October, reflecting soaring consumer demand for inflation hedges and safe-haven investments amid a 30% rise in gold prices this year.

Costco Gold

3. Samsung has abandoned plans to spin off its struggling foundry and logic chip divisions, which reported a $2.4 billion loss last year. These divisions have been expanding to reduce dependence on memory chips, facing challenges in building chip factories in Texas and competition from TSMC $Taiwan Semiconductor Manufacturing(TSM)$ .

Samsung chip

4. The National Development and Reform Commission (NDRC) of China will outline its plans to support the economy on Tuesday. This follows measures such as interest rate cuts and easing in the real estate sector. Morgan Stanley $Morgan Stanley(MS)$  predicts a stimulus plan worth 2 trillion yuan, focusing on local governments and consumer spending.

NDRC

5. According to CBRE, Hong Kong's commercial real estate (CRE) investment surged 22.6% to $1.28 billion in the third quarter, driven by interest rate cuts and a rebound in the Chinese stock market. However, with 55% of transactions driven by financially distressed assets and concerns over oversupply, prices are expected to continue declining.

Hong Kong Skyscraper

✅ Key Points:

As the Chinese market reopens, the balance between policy announcements and their real impact on economic fundamentals will determine whether current market optimism can be sustained.

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