Biden-Xi Meeting Confirmed, US Dollar Weighs On Risk Assets, Week In Review

Week in Review

• Asian equities were mixed this week, which began with gains in Korea on a short sale ban. Growth stocks and sectors regained some ground early in the week but ended it mostly lower.
• It was another busy week in economic news as China experienced slight deflation in October and the International Monetary Fund (IMF) raised its 2023 GDP forecast for China from 5.0% to 5.4%.
• The electric vehicle (EV) ecosystem got a boost this week from Li Auto’s Q3 earnings, which beat analysts’ expectations with a top line revenue increase of +271% year-over-year (YoY).
• The China Securities Regulatory Commission (CSRC), China’s SEC, commented on the “smooth” progression of US-China audit cooperation.

Key Notes

Asian equities were a sea of red on light volumes except for India, which managed a small gain as the specter of more US interest rate hikes weighed on risk assets globally following Fed Chair Powell’s press conference.

The potential for higher-for-longer interest rates weighed particularly on growth stocks and sectors though it was a broad decline as decliners outpaced advancers. CNY and the Asia Dollar Index have both weakened versus the US dollar, leading to a decline in the value of CNY denominated assets. Hong Kong suffered a deeper drawdown than Mainland China as the latter posted a small gain for the week.