Hang Seng Index Advances as Beijing Aims to Support HK’s Financial Center Status

US Markets: Nasdaq Advances as Dow Lags

On Monday, November 18, US equity markets had a mixed session. The Nasdaq Composite Index ended a four-day losing streak, gaining 0.60%, while the S&P 500 advanced by 0.39%. However, the Dow bucked the trend, dropping by 0.13%.

Notable movers included Super Micro Computer (SMCI), which surged 16%, and Tesla (TSLA), which advanced 5.62% on speculation the Trump administration could ease self-driving rules.

US Housing Market Data and the Fed Rate Path

The NAHB Housing Market Index increased from 43 in October to 46 in November. Improving housing market conditions could boost consumer confidence, fueling spending and demand-driven inflation.

The upswing lowered investor bets on a December Fed rate cut. According to the CME FedWatch Tool, the probability of a December Fed rate cut fell from 61.9% on November 15 to 58.7% on November 18.

10-year US Treasuries declined on Monday, boosting demand for riskier assets.

China Announces Fresh Restructure Debt Measures

On Tuesday, November 19, CN Wire reported fresh measures from China to ease local government debt pressures. China’s National Financial Regulatory Administration (NFRA) Head reportedly stated,

“WE ARE IMPLEMENTING THE NEW 60 BILLION YUAN LIMIT ON LOCAL GOVERNMENT DEBT AND SUPPORTING FINANCIAL INSTITUTIONS IN DEBT RESTRUCTURING TO ALLEVIATE PRESSURE ON LOCAL GOVERNMENT.”

The NFRA head added,

“WE ARE ENCOURAGING CHINESE-FUNDED BANKS AND INSURANCE INSTITUTIONS TO SET UP THEIR REGIONAL HEADQUARTERS IN HONG KONG TO SUPPORT ITS ECONOMIC DEVELOPMENT.”

The announcement highlighted Beijing’s ongoing efforts to bolster China’s economy, raising hopes for additional measures targeting domestic consumption.

China’s focus on Hong Kong was also evident. China’s Vice Premier He reportedly stated that Beijing was ramping up its efforts to support Hong Kong as an international financial center.

Hang Seng Index and Mainland China Equity Markets Advance

In Asian markets, the Hang Seng Index advanced by 0.42% on Tuesday morning, aiming to extend its gains from Monday. Hopes for further stimulus measures from Beijing countered US tariff jitters. Auto and tech stocks contributed to the morning gains.

The Hang Seng Tech Index gained 0.91%, with Baidu (9888) rallying 2.51%. Auto sector stock Li Auto Inc. (2015) advanced by 1.42%.

Mainland China’s equity markets also saw early gains, with the CSI 300 and the Shanghai Composite up by 0.22% and 0.30%, respectively.

However, concerns over potential US tariffs could dampen optimism.

Nikkei Index Rises Amid BoJ Policy Uncertainty

Japan’s Nikkei Index gained 0.29% on Tuesday morning. Uncertainty about a Bank of Japan rate hike and the USD/JPY at 154 supported buyer demand for Nikkei Index-listed stocks. However, the USD/JPY pullback in the Tuesday morning session capped the gains.

Softbank Group Corp. (9984) advanced by 0.27%, while Sony Corp. (6758) rose by 0.81%. However, Nissan Motor Corp. (7201) dropped by 0.72% in the morning session.

ASX 200 Hits Record High

In Australia, the ASX 200 Index rallied 1.10% on Tuesday morning, targeting a four-day winning streak. Banking, gold, and tech stocks drove the Index to an all-time high. The S&P Global/ASX All Technology Index jumped 2.92%. Technology One Ltd. (TNE) surged 10.65% after beating earnings forecasts.

Northern Star Resources Ltd. (NST) advanced by 3.14%, as gold rallied 1.91% on Monday and extended its gains on Tuesday.

High-yielding banking stocks also moved higher in response to falling US Treasury yields. Commonwealth Bank of Australia (CBA) led the gains, rising 1.39%.

The RBA Meeting Minutes had a limited impact on the ASX 200, with markets expecting the RBA to maintain its cash rate in December.

Looking Ahead

Key events this week include commentary from the Reserve Bank of Australia and the Bank of Japan, along with further stimulus measures from Beijing. Investors should also watch upcoming economic data releases and their potential impact on market sentiment.