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Tag: Taiwan Weighted Index

  • Hong Kong stocks fall as investors digest China economic data, await Fed rate verdict

    Hong Kong stocks fall as investors digest China economic data, await Fed rate verdict

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    A man walks along The Bund during the passage of Typhoon Bebinca in Shanghai on September 16, 2024. The strongest storm to hit Shanghai in over 70 years made landfall on September 16, state media reported, with flights cancelled and highways closed as Typhoon Bebinca lashed the city with strong winds and torrential rains.

    Hector Retamal | Afp | Getty Images

    Asian markets opened mixed Monday, with Hong Kong stocks falling as investors assessed downbeat economic data from China, while several key markets were closed for holidays.

    Hong Kong’s Hang Seng index fell 0.76% on open, after China released a slew of worrying economic data over the weekend, with August factory output, retail sales and investment numbers missing expectations. Urban jobless rate rose to a six-month high while year-on-year home prices fell at their fastest pace in nine years.

    Investors also await the Federal Reserve’s policy meeting on Tuesday and Wednesday where the central bankers are expected to make their first interest rate cut since 2020

    Australia’s S&P/ASX 200 rose 0.44% on open. The Taiwan Weighted Index edged up slightly.

    Markets in mainland China and South Korea were closed for Mid-Autumn festival. Japan markets were closed for Respect for the Aged Day.

    Typhoon Bebinca has led to cancellation of hundreds of flights in China and Shanghai is expected to be hit by the strongest storm since 1949.

    Asian investors also await a swath of key data and central bank decisions from the region.

    Japan’s inflation is expected to tick higher in August, according to a Reuters poll, backing the case for the Bank of Japan to stay hawkish as the board sets its policy on Friday.

    The central bank is anticipated to keep the rate unchanged while signaling that further rate hikes were in the offing.

    The Japanese yen strengthened Monday morning to trade at 140.49 against the greenback. If the yen holds these levels, the currency will close at its strongest in more than a year.

    China is poised to set its one- and five-year loan prime rates on Friday. The one-year rate, which affects most new and outstanding loans, is currently at 3.35%, while the five-year rate, that influences the pricing of mortgages, is currently at 3.85%.

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  • CNBC Daily Open: Moving past sticky core inflation

    CNBC Daily Open: Moving past sticky core inflation

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    Prices are displayed in a store window in Brooklyn on August 14, 2024 in New York City. 

    Spencer Platt | Getty Images News | Getty Images

    This report is from today’s CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.

    What you need to know today

    Stubborn core inflation
    Prices in the U.S. rose 0.2% in August, the Bureau of Labor Statistics reported, in line with the Dow Jones consensus. The 12-month inflation rate was at 2.5%, the lowest since February 2021. However, core CPI, which excludes food and energy prices, ticked up 0.3%, 10 basis points higher than expected.

    Rebound rally
    Major U.S. indexes closed higher in a choppy session on Wednesday, lifted by technology stocks. Asia-Pacific markets were trading higher on Thursday. Japan’s Nikkei 225 jumped 3.43% and the Taiwan Weighted Index rose 3%. Chip-related Asian stocks including Tokyo Electron, Advantest and TSMC rose, tracking the rally in U.S. technology stocks.

    UBS CEO sees soft landing
    Sergio Ermotti, Group CEO of UBS Group AG, told CNBC that investors expecting the Fed to cut rates aggressively are getting “ahead of the curve.” Sticky inflation remains the “most important” issue, he added – August’s core CPI surprised to the upside. However, Ermotti still sees “the outlook [as] pretty consistent with a soft landing.”

    Harris or Trump? Little difference for China
    Regardless of who wins the U.S. Presidential elections, the country’s trade ties with China will remain tense, said Carlos Casanova, senior economist at Swiss private bank UBP. Donald Trump has proposed tariffs of up to 100%, while Kamala Harris is expected to stick with Joe Biden’s tariff policy that not only retained Trump-era tariffs but also escalated them.

    [PRO] Opportunities for semiconductor stocks
    Semiconductor stocks have been the market’s darling this year and are responsible for pushing the S&P 500 to consecutive fresh highs. However, since July, they’ve had wild swings. Still, with some chip stocks being undervalued, they appear to be good buys amid this volatility, said analysts.

    The bottom line

    On the surface, Wednesday looked like a great day for investors.

    The S&P 500 climbed 1.07%, the Dow Jones Industrial Average added 0.31% and the Nasdaq Composite shot up 2.17%.

    However, those numbers are hiding turmoil under their pretty facades.

    The S&P dropped around 1% during trading but eventually managed to claw back losses and close more than 1% higher by the end of the day. It’s the first time the broad-based index has done so since October 2022.

    The consumer price index for August precipitated the initial fall. Core inflation, to which the Fed pays more attention because it more accurately reflects price movements, came in a bit higher than expected for the month.

    Core inflation was higher than the headline number because food and energy prices are stripped out from the former. And both were mild for the month: Food prices were only 0.1% higher, suggesting no pets need to be eaten, while energy costs fell 0.8%.

    Still, that data means the Fed’s unlikely to make a jumbo-sized 50-basis-point cut. Disappointment translated into stocks dropping.

    Even with inflation remaining difficult to tame, it doesn’t mean consumers are worse off. Real earnings rose 0.2% for the month, showed a separate Bureau of Labor Statistics report, which means the rise in income outstripped price increases.

    That might have helped the intraday rebound in the S&P.

    As for the Nasdaq, it was buoyed by technology stocks, which experienced a huge bounce from the previous days’ falls. Nvidia popped 8%, probably on news the U.S. might let the chipmaker sell advanced chips to Saudi Arabia, according to Reuters.

    But there might be more choppiness ahead in markets. The U.S. government is, once again, close to a shutdown because of politicking over government funding. It’s almost like the U.S. House of Representatives has no concept of a plan.  

    – CNBC’s Jeff Cox, Pia Singh and Lisa Kailai Han contributed to this story.

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