Market Highlights 💡 - 11 October 2024

US markets fell after a weak CPI report and unemployment claims reached a new high for the year; Hong Kong's Hang Seng Index rebounded due to Chinese central bank liquidity measures.

🇺🇸 US S&P 500 Index: -0.19%

🇺🇸 US Nasdaq Index: -0.05%

🇪🇺 EU Stoxx 600 Index: -0.17%

🇯🇵 Japan Nikkei 225 Index: 0.26%

🇭🇰 Hong Kong Hang Seng Index: 2.98%

🇨🇳 China CSI 300 Index: 1.09%

🇸🇬 Singapore STI: -0.29%

Wall Street closed lower, with the S&P 500 and Nasdaq Composite Indexes down -0.2% and -0.1%, respectively, as investors reacted to September inflation data that exceeded expectations and an increase in unemployment claims, seeking signs about the health of the US economy and interest rate trends.

September's US core CPI rose more than expected, increasing from a previous 3.2% year-on-year to 3.3% (expected was 3.2%), while rising food costs suggest the Federal Reserve may cut rates again next month.

For the week ending October 5, initial unemployment claims in the US increased by 33,000 to 258,000 (expected was 230,000), with a surge in claims from North Carolina and Florida, the latter being impacted by Hurricane Helen.

Asia-Pacific markets surged, with the Hong Kong Hang Seng Index $HSI(HSI)$ and Shanghai CSI 300 Index rising 3.0% and 1.1%, respectively, after the People's Bank of China initiated a $70 billion financing mechanism to fund institutional purchases, as traders bet on more fiscal stimulus from Beijing to boost economic growth.

Upcoming Events:

At the end of this week, we will see the preliminary University of Michigan Consumer Sentiment Index, Malaysia's year-on-year industrial production and retail sales released on Friday, as well as China's year-on-year inflation rate and year-on-year exports released on Sunday.

Things to Know Today:

1. AMD $Advanced Micro Devices(AMD)$  has launched a new AI chip, the Instinct MI325X, expected to enter mass production in Q4 2024, along with the next-generation MI350 series chips anticipated for use in the second half of 2025, featuring enhanced memory and performance that may rival Nvidia's upcoming Blackwell GPU.

AMD MI325X

2. Tesla's $Tesla Motors(TSLA)$  $Direxion Daily TSLA Bull 1.5X Shares(TSLL)$   highly anticipated "We, Robot" event is expected to showcase the design of dedicated robot taxis, updates to its Full Self-Driving (FSD) software, the Optimus humanoid robot, and potentially a $25,000 electric vehicle, marking a critical moment for the company to prove its position as a technological disruptor.

We, Robot Event

3. The People's Bank of China (PBOC) has introduced a swap tool worth 500 billion yuan ($70.7 billion), allowing qualified brokerages, mutual funds, and insurance companies to exchange bonds, ETFs, and CSI 300 $CSI300(000300.SH)$  stocks for liquid assets like government bonds and central bank notes, to support China's stock market.

People Bank of China

4. Beijing has intensified monitoring of wealth management products after investors pulled $149 billion to chase a stock market rebound. Regulators have instructed banks and fund companies to track the liquidity of these products daily and ensure short-term redemption liquidity, as the surge in withdrawals has put pressure on the corporate bond market, raising concerns about financial instability.

5. Public Bank  is acquiring a 44.15% stake in LPI Capital for 1.72 billion ringgit, with a per-share valuation of 9.80 ringgit—25% lower than the last trading price. This transaction will trigger a mandatory general offer for the remaining shares, making Public Bank the largest shareholder.

Public Bank x LPI Capital

Key Points:

On Thursday, US markets reacted to mixed economic data, leading to a decline in stocks and a rise in government bonds. As data stabilizes, a strong economy may continue to support stock market gains, and today's bank earnings could influence momentum.

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