The Windshield Versus The Rearview Mirror, Week In Review
6 Min. Read Time
Week in Review
- Asian equities were mostly lower for the week as Korea and India outperformed, managing gains, while Hong Kong's Hang Seng Tech Index and Mainland China's STAR Market both underperformed as profit-taking and trade headlines.
- September trade data, released on Monday, indicated that exports increased by +8.3% year-over-year versus August’s +4.4%.
- A spokesperson for China’s Ministry of Commerce responded to questions about renewed US tariff threats in retaliation for China's export controls on rare earths, noting, “China's export control is not a ban on exports, but will continue to license applications that meet the requirements."
- Alibaba's Singles Day pre-sales kicked off on Thursday. In the first hour, 35 brands had RMB 100 million in sales, 1,802 orders were received, and active users exceeded last year’s.
- Check out our latest video, where we explore China's explore China’s fast-moving humanoid robotics scene
Friday’s Key News
Asian equities ended the week with a thud, as markets moved to the lower right on concerns over the US’ regional bank crisis going global. The US dollar strengthened overnight.
Risk off ruled the day, so I wouldn’t overthink last night’s price action. There were several headlines that arguably weighed on sentiment, including US-China geopolitical tensions, China's 2023 ban on Micron selling server memory chips garnering attention, the IMF’s 2026 China GDP target of 4.2% versus 2025’s 4.8%, and BYD’s electric vehicle (EV) recall.
We reiterate our belief that Hong Kong and Mainland China-listed stocks were overbought and are simply working off that excess. This was indicated clearly by the Relative Strength Index (RSI). The Hang Seng Tech is officially in a correction territory following today’s steep decline in growth stocks in both Hong Kong and Mainland China. I am not going to belabor today’s significant decline, as the advancers versus decliners chart pretty much sums it up.
Volumes were light as mainland investors purchased $811 million worth of Hong Kong stocks via Southbound Stock Connect.
A few upcoming events could provide catalysts for investors, such as the following:
- The 4th Plenum kicks off Monday, which will include the draft of the 15th Five-Year Plan.
- From October 27th to 30th, Beijing will host the Financial Street Forum featuring the PBOC, SAFE, and National Financial Regulatory Administration.
- APEC in South Korea runs from October 27th to November 1st , with chatter that Trump and Xi will meet on October 30th or 31st.Singles Day is on November 11th , though Alibaba started pre-sales yesterday.
- Hong Kong and US-listed companies report Q3 financial results mid-November.
A rare bright spot was NIO, which gained +2.17% after denying fraud allegations.
The PBOC’s Pan Gongsheng spoke at the G20, stating that loose monetary conditions will continue. Tax revenue increased by +0.7% year-over-year (YoY) year-to-date (YTD) through September to RMB 1.33 trillion with stock trading stamp tax +10.34% to RMB 144.8 billion.
Sunday will be a fun day with September’s data dump with GDP, Retail Sales, Industrial Production, Fixed Asset Production, Loan Prime Rates, and New and Used Home Prices.
Enjoy the weekend!
Bernese mountain dogs have one flaw: they don’t live long enough. Having filled our home and lives with joy for eight years, we had to put our beloved Harry down yesterday. RIP to my friend!
Last Night's Exchange Rates, Prices, & Yields
| Country / Index | Ticker | 1-Day Change |
|---|---|---|
| China (Hong Kong) | HSI Index | -2.5% |
| Hang Seng Tech | HSTECH Index | -4.1% |
| Hong Kong Turnover | HKTurn Index | 14.2% |
| Hong Kong Short Sale Turnover | HKSST Index | 17.1% |
| Short Turnover as a % of Hong Kong Turnover | N/A | 16.9% |
| Southbound Stock Connect Net Buy/Sell (US $ Millions) | N/A | 804.94 |
| China (Shanghai) | SHCOMP Index | -2% |
| China (Shenzhen) | SZCOMP Index | -2.7% |
| China (STAR Board) | Star50 Index | -3.8% |
| Mainland Turnover | .chturn Index | 0.2% |
| Northbound Stock Connect Net Buy/Sell (US $ Millions) | N/A | Not Available |
| Jing Daily China Global Luxury Index | CHINALUX Index | -0.7% |
| Japan | NKY Index | -1.4% |
| India | SENSEX Index | 0.6% |
| Indonesia | JCI Index | -2.6% |
| Malaysia | FBMKLCI Index | -0.3% |
| Pakistan | KSE100 Index | -0.4% |
| Philippines | PCOMP Index | -0.1% |
| South Korea | KOSPI Index | 0% |
| Taiwan | TWSE Index | -1.2% |
| Thailand | SET Index | -1.3% |
| Singapore | STI Index | -0.6% |
| Australia | AS51 Index | -0.8% |
| Vietnam | VNINDEX Index | -2% |
| Indicator | Hong Kong | Mainland China |
|---|---|---|
| Today's Volume as % of 1-Year Average | 133 | 115 |
| Advancing Stocks | 41 | 787 |
| Declining Stocks | 458 | 4280 |
| Outperforming Factors | Value | Value |
| Underperforming Factors | Liquidity, Growth, Momentum | Liquidity, Growth, Momentum |
| Top Sectors | Financials, Utilities, Energy | Utilities, Energy, Real Estate |
| Bottom Sectors | Information Technology, Consumer Discretionary, Health Care | Information Technology, Industrials, Consumer Discretionary |
| Top Subsectors | Textiles | Soft Drinks, Forest Industry, Highways |
| Bottom Subsectors | Semiconductors, Technology Hardware, Aerospace | Power Generation Equipment, Electric Power Grid, Communication Equipment |
| Southbound Connect Buys | Meituan (Large), Xiaomi (Moderate), Pop Mart (Small), Transthera (Tiny) | N/A |
| Southbound Connect Sells | Alibaba, SMIC (Large), Hua Hong (Moderate), Tencent, ZTE (Small) | N/A |
| MSCI China All Shares Index | # of Stocks | Average 1-Day Change (%) |
|---|---|---|
| Hong Kong Listed | 151 | -2.74 |
| Communication Services | 9 | -2.31 |
| Consumer Discretionary | 28 | -3.58 |
| Consumer Staples | 13 | -2.41 |
| Energy | 7 | -1.62 |
| Financials | 23 | -1.52 |
| Health Care | 13 | -3.19 |
| Industrials | 20 | -2.38 |
| Information Technology | 10 | -4.53 |
| Materials | 10 | -2.75 |
| Real Estate | 6 | -2.13 |
| Utilities | 12 | -1.53 |
| Mainland China Listed | 404 | -2.27 |
| Communication Services | 6 | -1.74 |
| Consumer Discretionary | 31 | -2.84 |
| Consumer Staples | 24 | -1.46 |
| Energy | 13 | -0.89 |
| Financials | 64 | -1.15 |
| Health Care | 31 | -1.81 |
| Industrials | 64 | -3.18 |
| Information Technology | 91 | -3.98 |
| Materials | 58 | -1.59 |
| Real Estate | 6 | -1.03 |
| Utilities | 16 | -0.57 |
| US & Hong Kong Dually Listed | Ticker | 1-Day Change (%) |
|---|---|---|
| Tencent HK | 700 HK Equity | -1.9 |
| Alibaba HK | 9988 HK Equity | -4.2 |
| JD.com HK | 9618 HK Equity | -3.1 |
| NetEase HK | 9999 HK Equity | -3.5 |
| Yum China HK | 9987 HK Equity | -1.2 |
| Baozun HK | 9991 HK Equity | -6.6 |
| Baidu HK | 9888 HK Equity | -4.2 |
| Autohome HK | 2518 HK Equity | 1.1 |
| Bilibili HK | 9626 HK Equity | -3.5 |
| Trip.com HK | 9961 HK Equity | -2.6 |
| EDU HK | 9901 HK Equity | -5.4 |
| Xpeng HK | 9868 HK Equity | -4.3 |
| Weibo HK | 9898 HK Equity | -3.8 |
| Li Auto HK | 2015 HK Equity | -3.8 |
| Nio Auto HK | 9866 HK Equity | 2.2 |
| Zhihu HK | 2390 HK Equity | -3.5 |
| KE HK | 2423 HK Equity | -3.3 |
| Tencent Music Entertainment HK | 1698 HK Equity | -4.4 |
| Meituan HK | 3690 HK Equity | -4.3 |
| Hong Kong's Most Heavily Traded by Value | 1-Day Change (%) |
|---|---|
| ALIBABA GROUP HOLDING LTD | -4.2 |
| XIAOMI CORP-CLASS B | -3.6 |
| SEMICONDUCTOR MANUFACTURI-H | -6.5 |
| TENCENT HOLDINGS LTD | -1.9 |
| MEITUAN-CLASS B | -4.3 |
| HUA HONG SEMICONDUCTOR LTD-H | -6.9 |
| POP MART INTERNATIONAL GROUP | -4.4 |
| ZTE CORP-H | -12.8 |
| HONG KONG EXCHANGES & CLEAR | -2.5 |
| BYD CO LTD-H | -4.1 |
| Shanghai and Shenzhen's Most Heavily Traded by Value | 1-Day Change (%) |
|---|---|
| SUNGROW POWER SUPPLY CO LT-A | -10.9 |
| ZHONGJI INNOLIGHT CO LTD-A | 1.8 |
| ZTE CORP-A | -10 |
| CONTEMPORARY AMPEREX TECHN-A | -2.8 |
| CAMBRICON TECHNOLOGIES-A | -2.1 |
| ZHEJIANG SANHUA INTELLIGEN-A | 0.9 |
| LUXSHARE PRECISION INDUSTR-A | -6.3 |
| SEMICONDUCTOR MANUFACTURIN-A | -4.2 |
| EOPTOLINK TECHNOLOGY INC L-A | -2.6 |
| CHINA NORTHERN RARE EARTH -A | -0.3 |
Last Night's Exchange Rates, Prices, & Yields
- CNY per USD 7.13 versus 7.14 yesterday
- CNY per EUR 8.25 versus 8.28 yesterday
- Yield on 10-Year Government Bond 1.84% versus 1.82% yesterday
- Yield on 10-Year China Development Bank Bond 1.95% versus 1.97% yesterday
- Copper Price -0.35%
- Steel Price 0.33%
