China’s July Inflation Numbers Released
5 Min. Read Time
Key News
Asian equities were mixed overnight as Japan, Hong Kong, and Taiwan outperformed while Mainland China's Science & Technology (STAR) Board and Indonesia underperformed.
China's July inflation numbers were released yesterday, which showed a more-than-expected slowdown. China's Consumer Price Index (CPI) rose by +0.5% year-over-year (YoY), versus the consensus estimate of +0.8% and June's +1.0%, while the Producer Price Index (PPI) rose by +3.5% YoY, versus the consensus estimate of +3.9% and June's +4.1%. This was China's first lower-than-expected print since the start of the Iran conflict.
More data to come soon, with retail sales, industrial production, new and used home prices, and property investment numbers being released at the start of next week.
Hong Kong climbed higher as the consumer staples (+2.74%), consumer discretionary (+2.09%), and materials (+1.45%) sectors led gains. There were no negative sectors overnight and strong advancers versus decliners. The Hang Seng Index closed higher by +1.0% while the Hang Seng Technology Index closed higher by +1.3%. Hong Kong internet stocks had a strong day, with Alibaba, Hong Kong's second most heavily traded stock by value, gaining +2.3%, JD.com gaining +2.3%, and Tencent, Hong Kong's most heavily traded stock by value, edging higher by +0.5%. Top subsectors included coal, food, and textiles, while bottom subsectors included semiconductors, technology hardware, and consumer durables. Surprise, non-ferrous metals were not a top subsector overnight!
Hong Kong's Laopu Gold gained +12.4% amid a recent discounting campaign ahead of the Qixi Festival, with potential implications for its luxury positioning.
WuXi AppTec gained +3.0% as a US federal judge granted a preliminary injunction temporarily blocking the Department of Defense from enforcing the "Chinese military company" designation under Section 1260H while the underlying legal challenge proceeds.
Mainland investors were slight buyers of Hong Kong-listed stocks and ETFs, with a net buy of $258.1 million through the Southbound Stock Connect. This marked the first net buy in the last four sessions, as the previous three were net sells. MiniMax was the largest net buy via the Southbound Stock Connect.
Mainland China was mixed, with Shanghai gaining +0.7%, Shenzhen gaining +0.6%, and China's Science and Technology (STAR) Board closing lower by -0.4%. Mainland China's consumer staples (+2.74%), real estate (+1.66%), and healthcare (+1.47%) sectors outperformed, while information technology (-1.39%) underperformed. Top subsectors included soft drinks, heavy machinery, and catering tourism, while bottom subsectors included communication equipment, internet, and semiconductors.
Mainland China's Longsys Electronics gained +6.7% after the company announced a private placement at RMB560 per share, approximately 45% above Friday's closing price.
Cambricon fell by -6.3% after reporting first-half revenue of RMB6.0 billion, up from RMB2.88 billion a year earlier, but the results failed to impress investors despite strong top-line growth.
JD.com will kick off the internet stock earnings season on Thursday, before the U.S. market opens. Options data suggest an implied stock move of approximately 5.1% in either direction.
According to Bloomberg, Taiwan Semiconductor Manufacturing (TSMC) reported a 45% rise in its monthly sales, indicating sustained demand for AI hardware.
Last Night's Performance
| Country / Index | Ticker | 1-Day Change |
|---|---|---|
| China (Hong Kong) | HSI Index | 1% |
| Hang Seng Tech | HSTECH Index | 1.3% |
| Hong Kong Turnover | HKTurn Index | -7.5% |
| Hong Kong Short Sale Turnover | HKSST Index | 8.6% |
| Short Turnover as a % of Hong Kong Turnover | N/A | 0.2 |
| Southbound Stock Connect Net Buy/Sell (US $ Millions) | N/A | 258.08 |
| China (Shanghai) | SHCOMP Index | 0.7% |
| China (Shenzhen) | SZCOMP Index | 0.6% |
| China (STAR Board) | Star50 Index | -0.4% |
| Mainland Turnover | .chturn Index | -5.3% |
| Japan | NKY Index | 2.1% |
| India | SENSEX Index | 0.1% |
| Indonesia | JCI Index | -0.7% |
| Malaysia | FBMKLCI Index | 0% |
| Pakistan | KSE100 Index | -0.1% |
| Philippines | PCOMP Index | 0% |
| South Korea | KOSPI Index | 0.7% |
| Taiwan | TWSE Index | 1.6% |
| Thailand | SET Index | 0.8% |
| Singapore | STI Index | 1.1% |
| Australia | AS51 Index | -0.3% |
| Vietnam | VNINDEX Index | -0.0005 |
| Indicator | Hong Kong | Mainland China |
|---|---|---|
| Today's Volume % of 1-Year Average | 87% | 101% |
| Advancing Stocks | 79 | 208 |
| Declining Stocks | 13 | 81 |
| Outperforming Factors | Value | Value |
| Underperforming Factors | Growth | Growth |
| Top Sectors | Consumer Discretionary, Consumer Staples, Materials | Consumer Staples, Real Estate, Healthcare |
| Bottom Sectors | Financials, Communication Services (Both Positive) | Information Technology, Utilities |
| Top Subsectors | Coal, Food, Textiles | Soft Drink, Heavy Machinery, Catering Tourism |
| Bottom Subsectors | Semiconductors, Technology Hardware, Consumer Durables | Communication Equipment, Internet, Semiconductor |
| Southbound Connect Buys | MiniMax, KB Laminates, Genscript Bio | N/A |
| Southbound Connect Sells | Alibaba, Z.AI, Gigadevice (All Net Inflows) | N/A |
| MSCI China All Shares Index | # of Stocks | Average 1-Day Change (%) |
|---|---|---|
| Hong Kong Listed | 165 | 1.15 |
| Communication Services | 11 | 0.55 |
| Consumer Discretionary | 28 | 2.09 |
| Consumer Staples | 13 | 2.74 |
| Energy | 6 | 1.25 |
| Financials | 25 | 0.19 |
| Health Care | 16 | 1.41 |
| Industrials | 22 | 1.36 |
| Information Technology | 12 | 1.05 |
| Materials | 14 | 1.45 |
| Real Estate | 7 | 1.41 |
| Utilities | 11 | 1.17 |
| Mainland China Listed | 386 | 0.28 |
| Communication Services | 8 | 1.45 |
| Consumer Discretionary | 26 | 0.86 |
| Consumer Staples | 19 | 2.74 |
| Energy | 12 | 1.49 |
| Financials | 64 | 0.24 |
| Health Care | 31 | 1.47 |
| Industrials | 58 | 0.95 |
| Information Technology | 95 | -1.39 |
| Materials | 52 | 1.43 |
| US & Hong Kong Dually Listed | Ticker | 1-Day Change (%) |
|---|---|---|
| Tencent HK | 700 HK Equity | 0.5 |
| Alibaba HK | 9988 HK Equity | 2.3 |
| JD.com HK | 9618 HK Equity | 2.3 |
| NetEase HK | 9999 HK Equity | 0.2 |
| Yum China HK | 9987 HK Equity | -0.5 |
| Baozun HK | 9991 HK Equity | 4.4 |
| Baidu HK | 9888 HK Equity | 0.5 |
| Autohome HK | 2518 HK Equity | 1.9 |
| Bilibili HK | 9626 HK Equity | 2.4 |
| Trip.com HK | 9961 HK Equity | 2.1 |
| EDU HK | 9901 HK Equity | 1.6 |
| Xpeng HK | 9868 HK Equity | 1 |
| Weibo HK | 9898 HK Equity | -0.1 |
| Li Auto HK | 2015 HK Equity | 0.4 |
| Nio Auto HK | 9866 HK Equity | 3 |
| Zhihu HK | 2390 HK Equity | 1.6 |
| KE HK | 2423 HK Equity | 3.5 |
| Tencent Music Entertainment HK | 1698 HK Equity | 0.6 |
| Meituan HK | 3690 HK Equity | 1.8 |
| Hong Kong's Most Heavily Traded by Value | 1-Day Change (%) |
|---|---|
| TENCENT HOLDINGS LTD | 0.5 |
| ALIBABA GROUP HOLDING LTD | 2.3 |
| KINGBOARD LAMINATES HLDG LTD | -6.9 |
| Z AI CO LTD | 0.5 |
| MINIMAX GROUP INC | -1.2 |
| XIAOMI CORP-CLASS B | 2.1 |
| WUXI BIOLOGICS CAYMAN INC | 0.6 |
| YANGTZE OPTICAL FIBRE AND-H | 0.4 |
| WUXI APPTEC CO LTD-H | 3 |
| SEMICONDUCTOR MANUFACTURI-H | -1 |
| Shanghai and Shenzhen's Most Heavily Traded by Value | 1-Day Change (%) |
|---|---|
| ZHONGJI INNOLIGHT CO LTD-A | -6 |
| EOPTOLINK TECHNOLOGY INC L-A | -5.1 |
| CXMT CORP-A | -2.2 |
| GIGADEVICE SEMICONDUCTO-CL A | -3.4 |
| CAMBRICON TECHNOLOGIES-A | -6.3 |
| WUXI APPTEC CO LTD-A | 4.2 |
| SUZHOU DONGSHAN PRECISION-A | -4.8 |
| VICTORY GIANT TECHNOLOGY -A | 2.1 |
| HENGTONG OPTIC-ELECTRIC CO-A | 0.2 |
| ACCELINK TECHNOLOGIES CO -A | -7.6 |
Last Night's Exchange Rates, Prices, & Yields
- CNY per USD 6.74 versus 6.75 Friday
- CNY per EUR 7.79 versus 7.78 Friday
- Copper Price -0.19%
- Steel Price +0.08%
