Tech stocks rose 3% in Hong Kong; China’s performance data is disappointing

Primavera Capital says there is tremendous value in some Chinese tech stocks

Fred Hu, founder and chairman of Primavera Capital, said stocks of major Chinese tech companies are “so depressed” and “cheap” right now.

In Hong Kong, the Hang Seng Tech index has fallen more than 30% since the start of the year, although the index has rallied in recent weeks.

The Chinese government’s relentless crackdown and zero-Covid policy have dampened the confidence of tech entrepreneurs and investors, but there is “tremendous value” in some tech stocks, Hu said.

“China is a nation that any other successful nation would need [for] technology and innovation… I think there is an upside to most of these types of stocks,” he said.

– Charmaine Jacob

Hong Kong-listed Chinese technology stocks rose early in the session

Shares of Chinese technology companies in Hong Kong rose significantly in the first hour of trading.

Tencent increased by 7.6%, Meituan increased by 5.9% and Alibaba increased by 9%. The Hang Seng Tech index rose about 4%.

The moves came despite disappointing activity and retail sales data from China and after US President Joe Biden and Chinese President Xi Jinping met ahead of the G-20 summit in Bali.

The chief strategist at private investment firm Safanad said the discussion between the two leaders had gone “much better” than expected, although he attributed this largely to low expectations.

TSMC shares rose more than 9% on the Berkshire Hathaway news

stocks Taiwan Semiconductor Manufacturing Company Jumped after those listed in Taiwan Berkshire Hathaway announced a share of 4 billion dollars in the company.

The stock rose 9.44% to its highest level in nearly two months.

Berkshire added more than 60 million shares of the Taiwanese chipmaker’s American depositary receipts worth $4.1 billion (1.2%) TSM) at the end of the third quarter, Taiwan Semi became the conglomerate’s 10th largest holding at the end of September.

The stock has recently risen by around 8%.

China’s industrial production, retail sales miss expectations in October

China’s industrial production rose 5% in October from a year earlier, slowing from the 6.3% increase seen in September. The latest figure defies estimates of a 5.2% rise predicted in a Reuters poll.

Separately, retail sales in China fell 0.5% in October from a year earlier, missing expectations.

Analysts polled by Reuters had expected a 1% rise in September, while retail sales were expected to rise 2.5%.

– Abigail Ng

CNBC Pro: Top Morningstar strategist says stocks are 15% undervalued, shares 6 favorites

According to Morningstar, stocks can drop 15% in a bear market with multiple stocks.

The equity research firm’s chief US strategist believes the headwinds that existed at the start of the year will begin to subside early next year, benefiting stocks.

Dave Sekera also shared his “fair value” assessment of six companies with “wide economic moats” that would outperform in such an economic environment.

CNBC Pro subscribers can read more here.

– Ganesh Rao

Australia’s central bank is hinting at bigger interest rate hikes ahead

The Reserve Bank of Australia has hinted at more and possibly bigger interest rate hikes ahead in its efforts to tame inflationary pressures, according to minutes released from its latest meeting.

“The Governing Council agreed on the importance of returning inflation to target and expects interest rates to rise further over the coming period,” he said.

He said the central bank was considering raising cash rates by 50 basis points, but saw a stronger case for raising its rate by 25 basis points.

The RBA said the higher interest rates would be part of a wider effort to “create a more sustainable supply and demand balance in the Australian economy”, adding that its members did not rule out a return to larger hikes if necessary.

– Jihye Lee

Japan’s economy contracted unexpectedly in the third quarter, data showed

Japan’s economy unexpectedly shrank in the third quarter from a year ago, according to preliminary official estimates.

Gross domestic product decreased by 1.2% A Reuters poll missed estimates for a 1.1% increase in the July-September quarter from the same period last year.

– Abigail Ng

CNBC Pro: China eases Covid measures. Here’s how market professionals play it

Which Stocks May Benefit If China Rolls Back Zero Covid Policy? Market experts outline how the reopening will play out as China eases some virus controls.

Pro subscribers can read more here.

– Xavier Ong

Brainard lowers session lows on comments

The S&P 500 rebounded from lows and Treasury yields eased slightly from early morning highs after Federal Reserve Vice Chairman Lael Brainard told Bloomberg News that slowing the pace of interest rate hikes may be appropriate “soon.”

The S&P 500 was last down 0.1% after falling more than 0.7% at one point on Monday. The 10-year Treasury yield rose 5 basis points to 3.878% after earlier trading around 3.90%.

“I think what’s really important to emphasize is that we’ve done a lot, but we have more work to do in terms of both raising rates and providing restraint to get inflation down to 2% over time,” Brainard added.

– John Melloy, Jeff Cox

Fed’s Waller’s message to markets: Interest rate endpoint ‘still a ways away’

Fed Governor Christopher Waller said that while the central bank may raise interest rates more slowly next month, this should not be interpreted as a sign of easing in its fight to lower inflation.

“Stop focusing on speed and start focusing on where the bottom line is going to be. Until inflation comes down, that bottom line is still a ways off from there,” Waller said on Sunday.

Earlier this month, the Fed raised interest rates by 75 basis points to the highest level since 2008.

– Fred Imbert

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