Key News

Asian equities were higher overnight as China and the Philippines outperformed, Japan underperformed while Australia and Hong Kong were closed for Easter Monday.

Shanghai and Shenzhen posted strong days, driven by March’s “official” PMIs, which indicated strong results that beat expectations.

The “official” PMI survey is conducted by the National Bureau of Statistics focusing on large companies usually SOEs while the Caixin PMI survey is conducted by S&P (formerly IHS Markit) and focused on smaller companies that are usually privately held. PMIs are a diffusion index with readings over 50 indicating an expansion in activity month-over-month and readings under 50 indicating a contraction month-over-month. Manufacturing output was driven by strong new orders, including new export orders. We have long argued that China’s economy is rebounding slowly as the economy likely troughed last summer. The releases are good signs for the global economy as well.

Today’s strong move in Mainland China on strong volume and breadth came despite Stock Connect being closed overnight.

The electric vehicle (EV) ecosystem had a strong day in advance of March sales, which were released after the close. The world's largest battery maker CATL gained +4.04%, BYD gained +4.41%, and the world's fifth-largest lithium miner Tianqi Lithium gained +4.88%. According to CNevPost, BYD had the second-highest monthly sales ever in March, selling 302,459 new energy vehicles (NEVs). Among competitors, NIO reported 11,866 cars sold, Xpeng reported 9,026, and Li Auto reported 28,984.

Hong Kong’s markets were closed today for Easter Monday.

Shanghai, Shenzhen, and the STAR Board gained +1.19%, +2.38%, and +1.68%, respectively, on volume that increased +16.63% from Friday, which is 115% of the 1-year average. 4,256 stocks advanced while 705 declined. The growth factor and small caps outperformed the value factor and large caps. The top-performing sectors were Communication Services, which gained +3.46%, Consumer Discretionary, which gained +3.07%, and Technology, which gained +2.44%. Meanwhile, utilities and energy were both off, falling -1.16% and -1.02%, respectively. The top-performing subsectors were office supplies, autos, and household products. Meanwhile, coal, highways, and oil & gas were among the worst-performing subsectors. CNY and the Asia Dollar Index both fell versus the US dollar. The Treasury curve steepened. Copper gained while steel fell.

Last Night's Performance

Last Night’s Exchange Rates, Prices, & Yields

• CNY per USD 7.23 versus 7.23 Friday
• CNY per EUR 7.79 versus 7.78 Friday
• Yield on 1-Day Government Bond 1.46% versus 1.50% Friday
• Yield on 10-Year Government Bond 2.31% versus 2.29% Friday
• Yield on 10-Year China Development Bank Bond 2.43% versus 2.42% Friday
• Copper Price +0.68%
• Steel Price -1.25%