Hong Kong stocks drop in mixed Asia-Pacific trade ahead of China factory activity data

Abigail Ng

Shares in the Asia-Pacific were mixed on Monday ahead of China’s factory activity data that’s slated to be released, and as markets look ahead to the U.S. Fed meeting later this week.

Hong Kong’s Hang Seng index dropped around 1% in early trade while Hang Seng Tech index gained 1%. Gaming stocks dropped more than 2% after a casino was locked down on Sunday due to a Covid case. In mainland China, the Shanghai Composite fell 0.57% and the Shenzhen Component slipped 0.375%.

The Nikkei 225 rose 1.39%, and the Topix gained around 1%. South Korea’s Kospi added 0.58% and the Kosdaq was 0.52% higher.

In Australia, the S&P/ASX 200 increased 0.64%. MSCI’s broadest index of Asia-Pacific shares outside Japan was about flat.

China’s National Bureau of Statistics is expected to release its Purchasing Managers’ Index data Monday, and analysts expect a reading of 50, according to a Reuters poll.

Later this week, the Federal Reserve will hold its policy meeting and announce its interest rate decision. Several countries will report inflation data this week.

On Friday in the U.S., major stock indexes jumped 2% each on optimism that inflation may be slowing.

TICKER	COMPANY	NAME	PRICE	CHANGE	%CHANGE
.N225	Nikkei 225 Index	*NIKKEI	27435.26	330.06	1.22
.HSI	Hang Seng Index	*HSI	14597.73	-265.33	-1.79
.AXJO	S&P/ASX 200	*ASX 200	6830.7	45	0.66
.SSEC	Shanghai	*SHANGHAI	2898.86	-17.06	-0.59
.KS11	KOSPI Index	*KOSPI	2277.85	9.45	0.42
.FTFCNBCA	CNBC 100 ASIA IDX	*CNBC 100	6687.23	13.79	0.21

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Currency check: Japanese yen weakens past 148-levels

Japan’s yen weakened past 148-levels against the U.S. dollar in Asia’s morning trade for the first time since last Wednesday.

The moves come ahead of the Fed’s policy meeting this week, where the central bank is expected to hike rates by 75 basis points, further widening the rate differential between the U.S. and Japan.

The Japanese yen saw some strengthening to 146-levels last week ahead of the Bank of Japan’s monetary decision to hold rates steady, before creeping back toward 148 against the greenback.

It last stood at 148.23 per dollar.

— Abigail Ng

China’s factory activity for October forecast to be unchanged from September

China’s official Purchasing Managers’ Index for October is set to be about flat from September, according to a Reuters poll.

The reading is forecast to come in at 50, the point that separates growth from contraction. PMI prints compare activity from month to month.

In September, the economy eked out a PMI reading of 50.1.

— Abigail Ng

Traders looking for sign of a slowdown from Fed

Wall Street will be watching the Federal Reserve statement closely this week for signs that the central bank will ease up on its rate hike pace.

According to the CME FedWatch tool, traders believe there is an 80% chance that the Fed hikes rates by three quarters of a point on Wednesday.

That would bring the central bank’s target range to 3.75% to 4%.

Beyond that, however, the market looks more uncertain. There is just a 44% probability of another hike of that size in December.

— Jesse Pound

Source : CNBC