US equities experienced a choppy session overnight, although they did encouragingly finish close to their session highs. On the stock level, Nike (NKE US) fell 6.8% after the sneaker giant pulled its full-year guidance ahead of its (sort of) new CEO. Tesla (TSLA US) declined 3.5% after reporting their delivery number, while the tech sector was lifted by a 1.6% rise by Nvidia (NVDA US).
- We must give the bull market the benefit of the doubt, especially while the S&P500 remains above 5600.
The buying frenzy towards China showed no signs of abating on Wednesday, with turnover again smashing records. A gauge of Hong Kong-listed Chinese broker’s shares rose as much as 22%, with the index up over 70% since China announced plans to cut policy rates and boost the stock market last Tuesday. For example, China Galaxy Securities (6881 HK) has rallied for seven consecutive days, its best streak in 5-years, with the stock doubling.
We expect further gains from Chinese equities following the “whatever it takes” stimulus from Beijing and the PBOC, but the volatility isn’t for the faint-hearted.
