Market Recap
On Monday, US stocks opened lower but rebounded strongly, with the Dow, Nasdaq, and S&P 500 all setting intraday records and closing at new all-time highs, led by Nvidia and Apple. Investors are now eyeing the upcoming PCE price index and rising risks of a potential US government shutdown.
Last week, the Federal Reserve cut rates by 25 basis points for the first time since December, a widely expected move that initially caused volatility but was later interpreted as a dovish pivot amid mounting signs of labor market weakness.
According to the CME FedWatch tool, markets now anticipate two more 25-basis-point cuts before year-end. Investors will scrutinize upcoming macroeconomic data to ensure the expected easing path remains intact.
Barclays’ Head of European Equity Strategy, Emmanuel Cau, wrote: “With US equities at record highs and rate markets still pricing around five cuts over the next year, further support for stocks will depend more on strong macro data rather than additional dovish policy.”
US Stocks
Large-cap tech mostly advanced:
- Nvidia +3.93%
- Microsoft –0.67%
- Apple +4.31%
- Google –0.86%
- Amazon –1.66%
- Meta –1.63%
- Tesla +1.91%
- Oracle +6.31%
Chinese ADRs mostly fell, with the Nasdaq Golden Dragon China Index down 0.96%:
- Alibaba +0.88%
- JD.com –3.33%
- Pinduoduo –0.70%
- NIO –6.24%
- XPeng +1.39%
- Li Auto –1.17%
- Bilibili –1.10%
- Baidu +0.95%
- NetEase +0.20%
- Tencent Music +3.23%
US Market Technicals:
- Dow Jones: +66.27 (+0.14%) at 46,381.54
- Nasdaq: +157.50 (+0.70%) at 22,788.98
- S&P 500: +29.39 (+0.44%) at 6,693.75
Hong Kong Stocks
Hong Kong markets opened higher but reversed lower by midday. Tech stocks broadly declined:
- Baidu –7%+
- Bilibili, JD.com –4%+
- Meituan, Lenovo –2%+
- Kuaishou, Xiaomi –1%+
Bank stocks were active, with China Minsheng Bank up more than 1%. JPMorgan noted that even under extreme stress scenarios, bank stocks can still provide dividend yields of 4%–4.5%. It forecast RMB 14 trillion of incremental funds flowing into equities over the next three years, with high-dividend sectors being key beneficiaries. Improving fundamentals such as stabilizing net interest margins and recovering fee income support dividend sustainability.
Apple supply-chain stocks weakened, with Lens Technology down over 7%. CLSA reported on Sept. 22 that OpenAI is developing its own AI device in collaboration with a mainland Apple supplier, which could bring new growth opportunities to the supply chain.
Hong Kong Market Technicals:
- Hang Seng Index: –0.97% at 26,089.91
- Hang Seng Tech Index: –2.20% at 6,120.36
- China Enterprises Index: –1.17% at 9,261.04
A50 & A-Shares
Mainland Chinese indexes fell broadly in the morning session:
- Shanghai Composite –1.23% at 3,781.61
- Shenzhen Component –1.84% at 12,916.41
- ChiNext –1.75% at 3,053.48
- Beijing 50 –3.05%
Turnover across Shanghai, Shenzhen, and Beijing reached RMB 1.71 trillion for the half-day session, an increase of RMB 357.9 billion from the prior day. Nearly 5,000 stocks declined.
Leading sectors: banking, ports & shipping, insurance.
Lagging sectors: tourism & hotels, Huawei concept stocks, real estate, CROs, and internet finance.
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