Investment Insights

CIO Viewpoints

Why we think China A shares could catch up the performance from now?

Daily Insights

Focus of the Day
  • BOJ’s lack of hawkishness pressured JPY; USD/JPY broke 150, with 20-day moving average in focus

Other Commentaries

  • US June core PCE inflation exceeded forecasts; China July manufacturing PMI missed; global Q2 gold demand rose

Market Analysis

FX Markets Analysis

Latest Technical Highlights

JPY - Uptrend↗

Support / Resistance

vs HKD 5.1643 / 5.3400

vs USD 147.00 / 152.00

The Bank of Japan held its interest rate meeting on Thursday as expected, but reiterated its intention to continue raising interest rates. Given the divergence in monetary policy from other central banks, it is expected to remain positive for the yen in the medium to long term. Technically, the USD/JPY has a support at 147

 

Legends

Uptrend ↗  Sideways →  Downtrend ↘

Pertaining to historical trend technical analysis only and do not reflect any forecasts.

Provided by Hang Seng Investment Services Limited

Stock Markets View

  • Progress in trade talks, improving economic data, and resilient corporate earnings have driven the S&P 500 and Nasdaq to new highs. However, concerns over elevated valuations have emerged
  • A US-EU trade agreement has boosted sectors such as autos and consumer goods. While the ECB kept rates unchanged, it noted lingering economic uncertainties, suggesting potential market volatility ahead
  • Trade agreements between the US and Japan, Indonesia, and the Philippines, alongside upcoming Sino-US trade talks, have reduced trade uncertainty. This is expected to accelerate capital inflows into Asian equities
  • Markets remain focused on trade negotiations between the US and emerging LatAm, particularly Brazil. A breakdown in talks could weigh on regional performance
  • After reaching multi-year highs, the Hang Seng Index may face technical resistance at the 26,000 level. Pending policy details aimed at improving industry competition, we downgrade our view from Positive to Neutral
Legends

Positive - Expect that the particular asset class potentially may perform well relative to the relevant major global benchmark(s) in the long run
Neutral - Expect that the particular asset class potentially may perform in line relative to the relevant major global benchmark(s) in the long run
Cautious - Expect that the particular asset class potentially may not perform well or in line relative to the relevant major global benchmark(s) in the long run

Provided by Hang Seng Investment Services Limited

Bond Markets View

  • We downgrade to Neutral as ECB’s easing cycle approaches its end, limiting upside for EUR sovereign debt, while unattractive US Treasury yields offer little offset
  • The recent US-EU trade agreement has marginally narrowed credit spreads for US and European investment-grade bonds. We expect the market to stabilize in the near term
  • Asian investment-grade credit spreads have reached new lows, with further tightening potential, particularly in BBB-rated bonds
  • Resilience in the US labor markets have supported gains in US high-yield bonds. However, current yield levels now offer less appeal
  • Credit spreads in the Asian high-yield market continue to tighten. Anticipated policy support for China’s property sector is expected to bolster the performance of related bonds
  • We upgrade to Positive given USD weakness and declining appeal of long-dated US Treasuries, with flows expected to rotate toward emerging market sovereign debt
Legends

Positive - Expect that the particular asset class potentially may perform well relative to the relevant major global benchmark(s) in the long run
Neutral - Expect that the particular asset class potentially may perform in line relative to the relevant major global benchmark(s) in the long run
Cautious - Expect that the particular asset class potentially may not perform well or in line relative to the relevant major global benchmark(s) in the long run

Provided by Hang Seng Investment Services Limited

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