Week in Review
- Asian equities were mostly higher this week as the US Fed paused interest rate hikes, the PBOC made multiple cuts to key lending rates, policymakers hinted at more stimulus, and China released May economic data that was largely in line with expectations.
- The electric vehicle ecosystem continued its gains from last week as Xpeng led on better-than-expected pre-sales for its new G6 model.
- US Secretary of State Antony Blinken will travel to China this weekend in a significant milestone for US-China relations.
- Hong Kong Exchanges announced that it will allow trading of certain names in CNY so that Mainland investors can avoid the need for currency conversion.
Friday’s Key News
Asian equities ended a positive week higher on high volumes driven by FTSE indices rebalancing and the US’ quad witching (stock and index futures and options expiration).
In professional golf, they call Saturday “moving day” as golfers try to position themselves for Sunday’s final round. Similarly, big liquidity events like today allow institutional investors to shuffle their portfolios. Remember that institutional investors and active fund managers have been underweight China as many strategists are noting that ownership levels are back to October 2022 levels.
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