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How will the victory of Japan's ruling coalition affect the yen? (Chinese Only)

CIO Viewpoints

Why US software stocks would remain under pressure?

Daily Insights

Focus of the Day

  • Long-end JGB yields pulled back amid eased fears of a fiscal rout, for now

Other Commentaries

  • Survey showed bond strategists see US Treasury yields higher by year-end; CNH broke above 6.90; China barred automakers from pricing below cost

Market Analysis

FX Markets Analysis

Latest Technical Highlights

AUD - Uptrend↗

Support / Resistance

vs HKD 5.2126 / 5.6016

vs USD 0.67 / 0.72

Reserve Bank of Australia Governor Bullock emphasised on Thursday that if inflation remains elevated, the central bank will tighten monetary policy further. The yield differential between the Australian dollar and other currencies has continued to widen, with the AUD/USD reaching a three-year high on Thursday. Resistance is noted at 0.72 USD

 

Legends

Uptrend ↗  Sideways →  Downtrend ↘

*Pertaining to historical technical trend analysis only and do not reflect any forecasts or any forward looking views

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Stock Markets View

  • The Dow broke above 50,000. The market initially dipped before rallying, with funds flowing into traditional sectors. Tech performance was mixed, and software stocks faced pressure. Attention is drawn to upcoming inflation and employment data
  • A modest expansion in Eurozone business activity and planned government fiscal spending supported the economy. Fund inflows into regional value stocks helped balance tech sector volatility
  • US tech stock volatility dampened some Asian markets. Japan's election provided fresh momentum for its economy and equities. The US-India trade deal positioned Indian stocks to play catch-up
  • Latin American equities consolidated near highs. A UN 2026 economic outlook report assessed the region as stable, supporting a positive medium-to-long-term view for local equity and currency markets
  • The Hang Seng Index reclaimed its 20-day moving average. Global software stock swings pressured Chinese tech, but high-dividend traditional sectors like HK property and mainland energy supported the market
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

  • Subpar US employment data have heightened expectations for rate cuts. Market attention is now on upcoming US non‑farm payrolls and CPI releases
  • Long‑end US Treasury yields continue to consolidate at elevated levels. US investment‑grade corporates edged higher, led by energy and materials sectors
  • The US sharply lowered tariffs on India from 50% to 18%. With nearly one‑fifth of Indian exports destined for the US, the tariff reduction should support performance of relevant issuers
  • Volatility in the US high‑yield market increased. Yields and credit spreads rebounded following record lows, driven by weak US jobs data and a pickup in risk‑off sentiment
  • China’s softening of the “three red lines” policy may ease liquidity pressure on property developers. However, fundamental recovery remains uncertain, and spreads near historical lows offer limited valuation appeal
  • Indonesia’s bond yields edged higher with contained volatility after Moody’s lowered the sovereign rating outlook. The sector remains resilient, supported by rate-cut expectations and continued allocation demand
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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