Key News
Asian equities were mixed overnight with Australia closed for Anzac Day, which is in honor of Australians and New Zealanders “who served and died in all wars,” according to Google
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The chief headwind for Chinese equities has been geopolitical tensions driven by a lack of US-China diplomatic communication. This issue flared after China’s French Ambassador’s comments on former USSR states’ sovereignty despite the government publicly distancing itself from his comments. The coming Biden Executive Order defined by the high fence small yard concept of ring-fencing technology that could be used for military purposes has weighed on the Mainland/onshore China, which has historically been immune to geopolitical tensions versus Hong Kong-US ADRs/offshore China. Mainland investors have sold popular stocks/themes such as semis, AI, big data, etc., due to the potential export restrictions, despite the EO likely to focus on private equity more than public equity. The Mainland/onshore was off less than Hong Kong/offshore as foreign investors tend to “freak out” more than Mainland investors though both exhibited awful advance/decline ratios. Yes, there are other macro/risk factors, such as US rate hikes as the US dollar strengthened overnight versus China’s CNY and the Asia dollar index, the US bank crisis, US mega-cap tech earnings this week, and the US and debt ceiling.
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