Chinese shares dragged down Asian equities on the first trading day of the year following weaker-than-expected factory data and a speech from President Xi Jinping that flagged the headwinds facing the economy. Crude oil rose. Hong Kong’s benchmark share gauge slid as much as 1.7%, while its peers in the mainland and Taiwan also dropped. The losses drove a regional equity benchmark toward its first decline in seven days. Chinese factory activity shrank in December to the lowest level in six months, data published Sunday showed, while a private gauge of manufacturing released Tuesday showed a slight gain. Sluggish activity in the world’s second-largest economy also contributed to a slump in factories across Asia. President Xi in his annual new year address televised Sunday pledged to strengthen economic momentum and job creation, while conceding some “enterprises had a tough time” and “people had difficulty finding jobs and meeting basic needs.” China’s economy may face another tough year in 2024, said Mark Matthews, head of Asia research at Julius Baer. “President Xi has made it very clear that on the economic front, his priority is bringing down the size of the property sector and its importance in the economy,” he said on Bloomberg Television. “That process is painful.” Oil gained after Iran dispatched a warship to the Red Sea in response to the destruction of three Houthi boats by the US Navy over the weekend, a move that risks ratcheting up tensions and complicating Washington’s goal of securing a waterway that’s vital to global trade. Sentiment in Asia was also dented after people familiar said ASML Holding NV, which makes semiconductor manufacturing equipment, canceled shipments of some of its machines to China at the request of US President Joe Biden’s administration. US stock futures were little changed. The yen weakened against all its Group-of-10 peers in thin trading as investors monitored conditions after an earthquake in Japan on Monday. US 10-year note futures dropped, while cash Treasuries are shut in Asia for a holiday in Japan. Australian bonds slipped. Bitcoin climbed above $45,000 for the first time in nearly two years as anticipation of an approval of an exchange-traded fund investing directly in the biggest token intensified. Signs of exhaustion have emerged after a more than $8 trillion surge in the S&P 500 last year. Traders have looked past Federal Reserve uncertainty, recession angst and geopolitical risks. And many who came into 2023 dreading all that have ended up scrambling to chase the rally. Meanwhile, despite the persisting weakness in China, some investors consider a slump of almost 60% is a signal to buy Chinese stocks. Almost a third of 417 respondents to Bloomberg’s latest Markets Live Pulse survey say they will increase their China investments over the next 12 months. That compares with just 19% in a similar August survey and is higher than the 25% who planned to boost exposure in March.
Nikkei Closed Hang Seng -1.75% CSI -1.24% Shanghai -0.35% Shenzen -0.69%
Eur$ 1.1022 CNH 7.1305 CNY 7.1254 JPY 141.50 GBP 1.2718 CHF 0.8452 RUB 89.4717 TRY 29.5280 WTI$ 72.74 Gold 2,070 BTC 45,240 +3% -0.15% ETH 2,392 +2%
S&P +0.03% Nasdaq -0.08% EuroStoxx +0.62% FTSE +0.06% Dax +0.29% SMI
Macro :
- Oppenheimer’s Stoltzfus Sees US Stocks Stalling Before Earnings
- Goldman Tops M&A Advisory Ranking as Rivals Maneuver for Rebound
- Quants Score Gains With Value Tilt That Punished Popular Funds
- 2024 Outlook: $126 Billion Risk for Big Bank Capital in Endgame
- Saudi Fund Outpaces Singapore’s GIC With $31.6 Billion Splurge
- Musk’s X Value Cut by Another Fidelity Writedown, Axios Reports
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