Asian equities were largely higher though Japan, South Korea, and Taiwan were off. China was mixed overnight and Hong Kong and India closed higher.
Asian equities were largely higher though Japan, South Korea, and Taiwan were off. China was mixed overnight and Hong Kong and India closed higher. Over the weekend PBOC head Yi Gang stated that Evergrande’s problems are “containable”. Meanwhile, had a negative Wall Street Journal article on Alibaba documenting increased competition, which has caused the company’s market share in E-Commerce to fall from 78% in 2015 to 51% today. Alibaba’s Hong Kong share class did not seem to care as it rose +0.68% overnight as internet names had a good day overnight. However, Tencent saw another small net sale by Mainland investors via Southbound Stock Connect. As China gets further away from its Q1 2020 quarantine, the year-over-year comparisons get harder as the low bar comparison rises. However, retail sales were a bright spot in September, coming in well above estimates. The release opens debate on whether the PBOC will ease monetarily by cutting the bank reserve requirement ratio (RRR) or the loan prime rate (LPR). It is possible that regulation and carbon commitments, which have been ramped up lately, might be eased temporarily to help the economy. News over the weekend of a consumption tax hit liquor stocks hard as Kweichow Moutai and Wuliangye Yibin fell -6.1% and -8.11%, respectively. Both stocks were sold nearly 2 to 1 in Northbound Stock Connect, which led to a healthy exodus of $1.25 billion worth of Mainland stocks by foreign investors who decided to shoot first and ask questions later.
