Shares in the Asia-Pacific traded mostly lower on Monday as China’s central bank kept its benchmark lending rates, or loan prime rates, on hold — in line with expectations.
The Hang Seng index in Hong Kong fell 2.6%, leading losses in the wider region. In mainland China, the Shanghai Composite fell 0.62% and the Shenzhen Component also fell 1%.
The Nikkei 225 in Japan and the Topix were just above the flat line. In Australia, the S&P/ASX 200 was slightly lower. South Korea’s Kospi dropped 1.1%. The MSCI’s broadest index of Asia-Pacific shares outside Japan was down 1.2%.
|.N225||Nikkei 225 Index||*NIKKEI||27855.36||-44.41||-0.16|
|.HSI||Hang Seng Index||*HSI||17445.71||-546.83||-3.04|
|.AXJO||S&P/ASX 200||*ASX 200||7138.7||-13.1||-0.18|
|.FTFCNBCA||CNBC 100 ASIA IDX||*CNBC 100||7603.13||-112.76||-1.46|
Over the weekend, Malaysia’s election produced a hung parliament, and parties are trying to win support from other blocs to form the government. Later this week, Baidu will report earnings and Singapore will release inflation data.
China keeps its loan prime rates on hold as expected
China left its benchmark lending rate unchanged for a third month in a row, according to an announcement from the People’s Bank of China.
The one-year loan prime rate is steady at 3.65%, and the five-year rate is also on hold at 4.3%, the notice said.
— Abigail Ng
South Korea saw exports drop further in first 20 days of November
South Korea’s exports for the first 20 days of November fell 16.7% on an annualized basis, with demand from China lagging, according to data from the customs agency.
The slump in exports is a sharp drop from the 5.5% fall seen in October compared to the same period a year ago.
Imports also dropped 5.5% for the first 20 days of November, resulting in a slight improvement in the trade deficit — $4.4 billion for the period, compared with a deficit of $4.9 billion reported in October.
The country has recorded a total of $40 billion in trade deficit year-to-date, statistics from the agency showed.
— Jihye Lee
CNBC Pro: Morgan Stanley’s Mike Wilson predicts the S&P 500′s bottom, calls it a ‘terrific buying opportunity’
Morgan Stanley’s Chief U.S. Equity Strategist Mike Wilson says we’re in the “final stages” of the bear market, but the situation will remain challenging for a while longer.
He predicts when — and at what level — the S&P 500 will hit a “new low.”
— Weizhen Tan
China is expected to hold its benchmark lending rates steady, Reuters poll says
China’s central bank is expected to keep its one-year and five-year loan prime rates on hold, according to analysts polled by Reuters.
The one-year rate currently stands at 3.65%, and the five-year LPR is at 4.3%.
The People’s Bank of China last cut both rates in August.
China’s offshore yuan was weaker at 7.1376 against the U.S. dollar ahead of the decision early Monday.
— Abigail Ng
CNBC Pro: Strategist says Chinese tech stocks, like Alibaba, are ‘deeply undervalued’
This year’s 30% decline in the value of Chinese Big Tech stocks, such as Alibaba, has made them “incredibly cheap,” according to investment bank China Renaissance.
Its head of equities, Andrew Maynard, not only believes that the stock market appears to have bottomed, but also that investors may miss out on a rally if they remain underweight on China.
“Without a shadow of a doubt, being underweight China is going to cost you going forward,” Maynard said.
— Ganesh Rao
Markets are watching for more clues on Fed hikes and the economy in the week ahead
Investors may be a bit more cautious in the week ahead, with stocks seeking direction in quiet trading and the bond market’s warnings about recession getting louder.
The Thanksgiving holiday on Thursday should mean markets will likely be quiet Wednesday and Friday. Traders will be monitoring reports on Black Friday holiday shopping for feedback on the consumer.
“It’s really a week where data dependence is the key phrase,” said Julian Emanuel, senior managing director at Evercore ISI. “The bias [for stocks] is higher unless data continues to deteriorate and the Fed stays on its hawkish slant… which has clearly been reinforced in the last 48 hours.”
— Patti Domm, Tanaya Macheel
Source : CNBC