Hang Seng Index, ASX 200, Nikkei Index: HSI Up on Tencent Gains

US Equity Markets Mixed Amidst Uncertainty About the Fed

On Friday (June 14), 10-year US Treasury yields retreated, supporting buyer demand for US tech stocks. Nevertheless, the US equity markets ended the week with a mixed session. The Nasdaq Composite Index rose by 0.12%, while the Dow and S&P 500 saw losses of 0.15% and 0.04%, respectively.

The US Futures had a mixed start to the Monday (June 17) Asian session, with the Dow mini down 40 points while the Nasdaq mini gained 14.

Geopolitics and China in the Spotlight

On Monday (June 17), investor fears of destabilization to the EU project impacted buyer demand for riskier assets. A snap French General Election could lead to a far-left or far-right French government. Anti-immigration policies could fuel fears of a French departure from the Eurozone and the EU.

However, the Asian economic calendar also warranted investor attention, with China in the spotlight.

House prices in China were down 3.9% year-on-year in May after falling 3.1% in April. Economists forecast house prices to decline by 3.5%.

Furthermore, industrial production figures also disappointed, rising 5.6% year-on-year in May after an increase of 6.7% in April. Fixed asset investments were up 4.0% (year-to-date) year-on-year after advancing 4.2% in April.

The figures tested investor expectations of a sustainable Chinese economic recovery.

However, better-than-expected retail sales figures provided comfort. Retail sales increased 3.7% year-on-year after rising 2.3% in April. Economists expected retail sales to increase by 3.0%.

Despite the house price trends in China, the PBoC left the 1-year Medium Term Lending Facility (MLF) rate at 2.5%.

Beyond China, economic indicators from Australia and Japan and commodity prices pressured buyer demand for ASX 200 and Nikkei Index-listed stocks.

Hang Seng Index Finds Tech Stock Support

It was a mixed start to the week for the HK and Mainland China equity markets. The Shanghai SE Composite and CSI 300 saw losses of 0.34% and 0.23%, respectively.

However, the Hang Seng Index bucked the broader market trend, gaining 0.60%. Tech sector gains countered losses across the real-estate sector. The Hang Seng Tech Index (HSTECH) was up 0.74% in the morning session.

Alibaba (9988) fell by 0.96%, with Baidu (9888) declining by 1.64%. However, Tencent Holdings (0700) advanced by 1.45%.

The Hang Seng Mainland Properties Index (HSMPI) was down 0.57%.

Nikkei Faces the Bank of Japan Monetary Policy Decision

The Nikkei Index slid by 1.94% in the Monday morning session. A stronger USD/JPY failed to limit the losses. Economic indicators from Japan contributed to the losses. Machinery orders fell by 2.9% in April after rising by 2.9% in March.

Sony Group Corporation (6758) slid by 2.61%. Tokyo Electron Ltd. (8035) and Fast Retailing Co. Ltd. (9983) saw losses of 2.46% and 2.40%, respectively. Furthermore, Softbank Group Corp (9984) declined by 1.50%, with KDDI Corp. (9433) falling by 0.78%.

ASX 200 Pressured by Mining, Oil, and Tech Stocks

The ASX 200 fell by 0.15% on Monday morning. Iron ore spot and WTI crude oil price trends impacted buyer demand for mining and oil stocks.

Woodside Energy Group Ltd (WDS) and Santos Ltd (STO) saw losses of 0.66% and 1.14%, respectively.

BHP Group Ltd (BHP) and Rio Tinto Group Ltd. (RIO) were down 0.49% and 0.62%, respectively. Fortescue Metals Group Ltd. (FMG) bucked the trend, rising by 0.24%.

Tech stocks contributed to the losses. The S&P/ASX All Technology Index declined by 0.57%.

However, gold (XAU/USD) and bank stocks limited the losses.

Northern Star Resources Ltd. (NST) and Evolution Mining Ltd (EVN) advanced by 0.67% and 0.83%, respectively.

Westpac Banking Corp. (WBC) rose by 0.49%, with National Australia Bank Ltd. (NAB) gaining 0.21%. Additionally, Commonwealth Bank of Australia (CBA) and ANZ Group Holdings Ltd. (ANZ) saw gains of 0.12% and 0.03%, respectively.

Moreover, economic indicators from Australia failed to support buyer demand for ASX 200-listed stocks. ANZ-Indeed Job Ads slid by 2.1% in May after rising by 2.8% in April.

For upcoming economic events, refer to our economic calendar.