Asian Macro Initial Thoughts; Another risk off day; Yen above 150, SK Hynix numbers mixed, Meta tumbles after market

Asia 

Even with the good China news and HK policy address turnover only reached HK$95.472bn,  suggesting that the news was not enough to reassure investors.  Volumes in other markets were light too suggesting that investors are wary of equities.  Earnings remain in focus.

NDX testing 200 day moving average; its worst day since February; as Alphabet fell almost 10% after disappointing earnings, Yen above 150.1 mark hitting a 30 year low. Meta currently -3.6% in after market despite beating forecast and outlook inline with expectations; after the earnings call mentioned concerns about the macro economic environment which suggests the sell off may be overdone; as that environment existed during these good earnings numbers.

The US House manages to elect a speaker; the unknown Mike Johnson; of whom they say he hasn’t been around long enough to have enemies.  But it means the house can get on with business and it is highly likely that he will be unopposed until at least the mid term elections are passed.

AMSL under pressure as bloomberg reports its equipment was used to help Huawei produce its new advanced chip.

Housekeeping  

Available for work or consultancy projects;  if you hear of anything please reply to this email (andsullivan@gmail.com )  or call me +852 9129 1016.

I am doing some work with The Metals Company a US listed deep sea mining company;  the focus is on Nickel and Cobalt and other metals needed for Electric Vehicles.  The Chairman and CEO Gerard Barron and Craig Shesky the CFO will be in Hong Kong  25 -27 October and then Singapore on Monday 30 October.  Let me know if you or colleagues would be interested in meeting.

For more interesting market comments and an interesting angle on portfolio construction to follow Market Thinking  https://www.market-thinking.com

For a range of independent research (macro and micro), trading analysis and free webinars check out ERI-C.com

Dr John Greenwood Chief Economist at International Monetary Monitor (IMM) who is visiting both Singapore & Hong Kong soon, explained why he has a high conviction of an imminent downshift in the global economy into recession on an ERI-C webinar last week (replay available) .
Singapore:    Tuesday 7th PM -  Thursday 9th November PM 
Hong Kong:  Monday 27th November - Friday 1st December
Let me know if you would be interested in meeting.

MARKET INDICATIONS

Australia 
Market opened lower, currently -54pts testing 6,800 level with tech stocks selling selling pressure after futures had indicated -18pts -0.26% at 6,842   RBA’s Bullock speaking which is prompting some weakness in the A$.

Japan 
Futures indicate down 290pts -0.93% at 30,950 (Chicago futures -170pts -0.55% @ 30,835) Yen now above 150 vs USD meaning the market is watching for intervention.

S Korea 
Futures indicate -1.7pts -0.53% at 317.85 pre market data saw Business Confidence was slightly better and GDP growth also beat.  SK Hynix numbers just coming out Q3 Sales beat (9.07T Won vs 8.14t f/cast) but the Operating loss was slightly worst loss than expected (1.79t Won vs 1.7t F/cast) Slight -VE for Memory makers.  

Taiwan 
Expect market to open lower with TSMC and tech under pressure after the weakness in US tech names.

China 
Market to open lower after the Golden Dragon China Index closed -2.16%

Hong Kong 
ADR’s closed up 30pts 0.18% at 17,115 but only HSBC, CCB, AIA, Tencent and Meituan in the green.  Futures up 27pts 0.16% at. 17,158 but I expect the market to trend lower following the regional weakness and lack of 

Singapore 
Futures indicate -6pts -0.19% at 3,080
Data due Industrial Production, 6 month T Bill Auction

India 
No data due 

Europe 
Data Due
Eurozone ECB Rate Decision, ECB’s Largarde Speaks
Germany No data due
France No data due
United Kingdom Car Production, CDI Distributive Trades, BoE’s Cunliffe Speaks

US Futures 
Opened Dow flat, S&P -0.3% and NDX -0.7%  Aftermarket moves Meta -3.6% beat on top and bottom lines in the third quarter, but the company’s Reality Labs division lost $3.7 billion.  Align Technology -23% after the company offered weak fourth-quarter revenue guidance and missed estimates in the third quarter.

Earnings in focus with Amazon scheduled to post results after the close, along with Ford and Chipotle.   Bond market volatility also a key focus.

Data due Durable Goods Orders data, Non Defense Goods Orders,  GDP Data (Growth Rate, Price Index, Sales),  Goods Trade Balance, Initial Claims, 4 week Average Claims, Continuing Claims, Wholesale & Retail Inventories Data

AUSTRALIA 
Data due
RBA Bullock & Kent speaking
Later Export & Import Prices

Bullock already speaking this morning says higher CPI numbers were where they expected and whether that was material enough to consider hiking again.  Said exports to China doing well but that the Chinese property sector a concern.  Analyst increasingly expected a hike at the next meeting in November but at the moment the A$ is weaker.

The inflation blockbuster coming to Australian mortgages. Like the trailer for a new movie, the most recent inflation figures are a tease for the Reserve Bank’s next meeting with an interest rate rise top billing.

The graphs that show households are putting themselves at financial risk
New data reveals how stressed households are grappling with the cost of living crisis caused by inflation and higher interest rates.

Tabcorp shareholders protest against ‘excessive’ executive pay. Almost 35 per cent of shareholders voted against the wagering giant’s remuneration plan, arguing it did not match the company’s size and performance since demerging from The Lottery Corporation.

Canned fruit giant SPC asks Goulburn Valley locals to tip in $20 million. The 106-year-old company is launching a capital raising to invite Goulburn Valley residents to become shareholders in the fruits and vegie business once more.

Tech billionaire Cannon-Brookes backs climate jobs platform. Terra.do was founded in 2020 and launched in Australia this week, with about 4500 clean energy jobs available across the country.

Regulator takes to big screen to spread smart word on ‘dumb money’. ASIC is going direct, to a cinema near you, with its warning on not getting burnt by social media investing.

JAPAN 
Yen 150.01
Data due Stock & Bond Investment.

Kokusai Electric (6525.T) shares jumped 28% in their Tokyo market debut on Wednesday after private equity firm KKR sold shares in the chip equipment maker for $724 million in Japan's largest initial public offering (IPO) in five years.  The stock closed at 2,350 yen, valuing the company at 541.5 billion yen ($3.61 billion) as investors grabbed shares following the rare IPO of a key chip tool manufacturer. Key will be whether they can hold onto those gains today.

We love battery EVs.” Takero Kato, the executive in charge of electric vehicles at Toyota, said that not once, but twice, to emphasize what he considers the message at this year’s Tokyo auto show. It’s a message ringing clear at the Tokyo Mobility Show, which will run through Nov 5 at Tokyo Big Sight hall and where battery-powered electric vehicles are the star at practically every booth. Mazda Motor Corp is highlighting a sportscar concept that is a plug-in EV packed with its signature rotary engine. Honda Motor Co is showing off its Prelude sportscar EV concept. Toyota Motor Corp’s lean angular Lexus concept, set to go on sale in 2026, is an electric vehicle running on lithium-ion batteries. Journalists got a preview Wednesday ahead of the show’s public opening Saturday.

SOUTH KOREA 
Data out
Business Confidence Oct 69 vs68 Sept (F/cast was 68)
Adv GDP Growth Rate Q3 0.6% QoQ vs 0.6% Q3. (F/cast was 0.5%)
Adv GDP Growth Rate Q3 1.4% YoY vs 0.9% Q3. (F/cast was 1.2%)

President Yoon Suk Yeol and Qatar's Emir Sheikh Tamim bin Hamad Al Thani agreed on Wednesday to upgrade bilateral ties by forging a comprehensive strategic partnership ahead of the two countries’ 50th anniversary of diplomatic relations next year. Under the agreement, the two countries will expand communication channels in the fields of diplomacy and security, as well as bilateral cooperation in the defense industry. The leaders, during their summit held the same day, shared their views on the need to expand cooperation across various fields including infrastructure, agriculture, shipping, culture and health.

LG Energy Solution (LGES) (373220.KS) warned on Wednesday of slowing revenue growth in 2024 due to global economic uncertainties affecting the outlook for electric vehicle sales, sending its shares down nearly 9%. It joins a growing number of automakers and suppliers expressing caution about demand for EVs, as they fear high interest rates lifting financing costs and sputtering growth in major economies such as China and Europe will impact car buyers.  Comes as, on Wednesday, Honda (7267.T) and General Motors (GM.N) announced they were ending a $5 billion plan to develop lower-cost EVs together just a year after announcing the effort. GM on Tuesday said it would focus near-term EV efforts on meeting demand rather than hitting specific volume targets.

LG Display (034220.KS) on Wednesday flagged a return to profit in the current quarter, sending its shares surging, as weakness in premium TV sales drove it to report a sixth consecutive quarterly loss. Demand for personal computers, TVs and mobile phones has been down on last year due to economic uncertainties and rising living costs, leading to device makers buying less components to make them.

Samsung Biologics said Wednesday it exceeded 1 trillion won ($741 million) in quarterly sales for the first time, following the operation of its fourth plant and profits generated by long-term contract manufacturing orders. According to regulatory filings for the July-September period, Samsung Biologics’ quarterly sales on a consolidated basis hit a record high of 1.34 trillion won, marking 18 percent on-year growth.  Operating profits were 318 billion won during the same period, down 2 percent from a year prior. Cumulative sales and operating profits were 2.6 trillion won and 763 trillion won as of the third quarter this year, up 29 percent and 14 percent from the same period last year, respectively.  The company said its increased production capacity has been driving up its sales overall. The fourth plant with a production capacity of 240,000 liters went into full operation in June. New contract manufacturing orders also contributed to upbeat earnings. As of October, its cumulative orders secured amounts to $11.8 billion.
Samsung Bioepis, a biosimilar developer wholly owned by Samsung Biologics, meanwhile, saw a drop in its financial showings. It recorded 262 billion won in sales and 49.2 billion won in operating profits, down 3 percent and 37 percent on-year, respectively.

TAIWAN 
No Data due.

Democratic Progressive Party (DPP) Legislator Chao Tian-lin (趙天麟) yesterday said he was willing to cooperate with any national security investigation into his affair with a Chinese woman, but added that Chinese Nationalist Party (KMT) Legislator Ma Wen-chun (馬文君) should also be investigated for allegedly leaking national security secrets, and she should also cooperate. Taking questions from reporters at the legislature in Taipei yesterday, Chao denied he had leaked national secrets, while reiterating his decision to end his re-election bid, which he announced on Tuesday night, following media reports that he had an extramarital affair with a Chinese woman surnamed Zhang (張), and photos of the two kissing became public.

India is a favorable destination for Taiwanese manufacturers with a huge market, many young and skilled talent, a pluralistic society with strong rule of law, and credible long-term partnerships, India Taipei Association (ITA) Director-General Manharsinh Laxmanbhai Yadav said yesterday. Yadav made the remarks at a luncheon with local researchers and reporters at the ITA office in Taipei, joined by Indian Department for Promotion of Industry and Internal Trade (DPIIT) Secretary Rajesh Kumar Singh, who is leading a group of more than 50 Indian delegates visiting Taiwan from Tuesday to tomorrow to deepen economic and people-to-people ties. The delegation comprises key figures from the Federation of Indian Chambers of Commerce and Industry and Electronic Industries Association of India. 

United Microelectronics Corp (UMC, 聯電), the world’s No. 3 contract chipmaker, yesterday said its factory utilization would fall to the low 60 percent range this quarter as customers grapple with excess inventory, although early signs indicate that demand is stabilizing in the PC and smartphone segments. UMC provided the business outlook after reporting a 1.4 percent sequential improvement in net profit last quarter to NT$15.97 billion (US$493.8 million), from NT$15.64 billion in the second quarter, while factory utilization stood at 67 percent, the lowest in about 12 years. On an annual basis, net profit plunged about 41 percent from NT$26.99 billion, the company said.  “For the fourth quarter, with recent rush orders from PC and smartphone makers, we expect demand to gradually stabilize. However, customers are still maintaining a cautious and conservative approach in addressing inventory levels, while the conditions for the automotive business appears challenging,” UMC co-CEO Jason Wang (王石) told a virtual investors’ conference.

The nation’s securities account balance, a gauge of retail investors’ confidence in local equities, fell to the lowest level in five months last month, as the TAIEX continued to consolidate and stock trading momentum slowed, the central bank said on Tuesday. The securities account balance declined to NT$3.25 trillion (US$100.5 billion) from NT$3.35 trillion in the previous month, data compiled by the central bank showed. It had dropped for the second straight month and hit its lowest since April, when the balance stood at NT$3.19 trillion, the data showed.  Foreign investors’ New Taiwan dollar-denominated deposit balance also decreased to NT$185.5 billion last month, down for the second consecutive month and reaching the lowest in three-and-a-half years, the bank said in a report.

The number of furloughed workers on formal unpaid leave programs in the manufacturing sector rose more than 1,200 in one week as the export-oriented sector continued to be affected by a weakening global economy, which led to a drop in orders, the Ministry of Labor said yesterday. Data compiled by the ministry showed that the number of workers placed on furlough programs in the sector rose 1,261 from Oct. 15 to 9,772 as of Monday. Labor Conditions and Equal Employment Division section head Li Suu-hsien (李思嫺) said that the metals and machinery industry reported the highest number of furloughed workers, with three bicycle component suppliers placing about 800 people on unpaid leave.

CHINA
No Data due but Friday we get Industrial Profits.

Spot USD/CNY dropped 75 bps to close at 7.3150 WEdnesday (25th). As of 4:42 pm, USD/CNY in night session sank 66 bps. USD/CNH fell 85 bps to 7.3206, trading 110 bps lower than USD/CNY.

Nikkei Asia reported that capital outflows from China expedited, with September tracking the largest net outflow in over 7.5 years, as foreign firms scaled back their operations in China and China's affluent shifted their money overseas. The mainland government was also concerned about the capital outflow given intensified downward pressure on RMB, and slapped new restrictions on investors. The report cited the State Administration of Foreign Exchange (SAFE)'s monthly data on Chinese bank balances that net capital outflows whopped US$53.9 billion in September, the highest since January 2016, under the double whammy of the sudden depreciation of RMB and the circuit breaker mechanism that was briefly implemented on the A-share market.

U.S. officials "frankly raised areas of disagreement" with China at the first meeting of a new financial working group, where financial stability, supervision and regulation were discussed, the U.S. Treasury said on Wednesday.  Attendees included senior officials from China's central bank and the U.S. Treasury Department, according to a Treasury statement. "The two-hour virtual meeting included a substantive and wide-ranging discussion on domestic and global financial stability, financial supervision and regulation, sustainable finance, and anti-money laundering and countering the financing of terrorism," the Treasury said.

California governor Gavin Newsom met Chinese president Xi Jinping on Wednesday to discuss climate change, raising hopes that China and the United States can find common ground ahead of an APEC summit and COP28 climate meeting next month. Xi and U.S President Joe Biden are expected to meet at the Asia-Pacific Economic Cooperation (APEC) summit in San Francisco in November, although the meeting has not been confirmed. Newsom told reporters after the meeting that he had an opportunity to focus more deeply and substantively on the issue of climate with Xi, while they also discussed Israel and the deadly drug fentanyl.

China's defence ministry on Wednesday denounced the U.S. Defense Department's annual report on China, saying it distorts the country's security policy and military strategy. Over the next decade, the People's Republic of China will rapidly modernise, diversify, and expand its nuclear forces, the Pentagon said in its report to U.S. Congress, laying out China's national ambitions, including its defence policy and military strategies.

Kone (KNEBV.HE) reported on Wednesday better-than-expected new orders for the third quarter, boosted by strong momentum from its key Chinese market. Kone's orders received fell by 7.7% to 1.99 billion euros ($2.10 billion) in the quarter, but that slightly beat analysts' estimate of 1.98 billion euros in a company-provided poll. At comparable exchange rates, the orders were up 0.3%. Kone, which makes about a third of its sales in China, had earlier said it expected the new equipment market in the country to decline between 10% and 15% this year. Due to its bigger exposure to China, the Helsinki-listed company would be more vulnerable to that than its Swiss rival Schindler (SCHP.S). The Chinese market makes up about 15% of Schindler's sales. Schindler last week raised 2023 guidance after a 23% jump in quarterly profit, driven by growth in maintenance and other services.

HONG KONG  
Data due Balance of Trade, Exports & Imports

Earnings 26 companies report today including Sinopec, Sinotrans, Air China, CCB,  Datang Int Power, Citic Bank, COSCO Shipping, China Life, China Oilfield Services.
Earnings out
NEW ORIENTAL-S (09901.HK) announced its results for 1Q ended August this year, with revenue of US$1.1 billion, up 47.7% YoY. Net profit was US$165 million, surging 150.6% YoY.  Non-GAAP net profit for the quarter was US$189 million, hiking 126.2% YoY. Non-GAAP basic and diluted profit per ADS were US$1.15 and US$1.13 respectively. At the end of August, the total number of schools and learning centres stood at 793, an increase of 87 YoY, while the total number of schools stood at 83.  In addition, the overseas examination preparation and overseas study consulting businesses recorded YoY growth of 51.7% and 26.6% respectively in 1Q, and the business of various new education initiatives grew by 103.3% YoY. The intelligent learning systems and devices were adopted in about 60 cities, with about 181,000 active fee-paying customers in 1Q.  NEW ORIENTAL's US ADR (EDU.US) rose 0.94% in pre-market trading, last trading at US$63.39.

LI NING (02331.HK) announced that for 3Q ended 30 September 2023, the retail sell-through of LI-NING POS (exclude LI-NING YOUNG) for the overall platform increased by mid-single-digit on a YoY basis. In terms of channels, offline channel, including retail and wholesale, registered a high-single-digit growth, with retail (direct operation) channel increased by low-twenties and wholesale (franchised distributors) channel increased by low-single-digit. The e-commerce virtual stores business, however, registered a low-single-digit decline.  For the quarter, the same-store sales (SSS) of LI-NING points of sale (POS), excluding LI-NING YOUNG, that have been in operation since the beginning of 3Q22 registered a mid-single-digit decline over the whole platform on a YoY basis. In terms of channels, retail channel registered a mid-single-digit increase and wholesale channel registered a low-teens decline; while the e-commerce virtual stores business registered a low-single-digit decline on a YoY basis.

ASMPT (0522) saw its third-quarter net profit tumble by 98 percent yearly to HK$12.8 million, citing weak consumer demand. Revenue during the July-September period fell to HK$3.47 billion, 23.8 percent lower from one year ago.
Both net profit and revenue missed the market expectations. Bookings also fell 18.3 percent year-on-year to HK$2.96 billion.

BUYBACKS
STANCHART (02888.HK) announced that it bought back 2.1796 million shares in London Monday (24th) at a price of between GBP7.004 and GBP7.134 per share, involving GBP15.429 million.

HSI Short Selling Wednesday 19.2% vs  17.5% Thursday 
Top shorts Shenzhen Int (2313) 63%, New World Dev (17) 56%, Wuxi Bio (2269) 41%, Henderson Land (12) 39%, WH Group (288) 39%, ICBC (1398) 38%, HK & China Gas (3) 36%, Haidilao (6862) 35%, Hang Seng Bank (11) 33%, BYD (1211) 32%, Bank of China (3988) 32%, Xiaomi (1810) 31%, OOIL (316) 31%, BoC HK (2388) 30%, cup (2) 30%, Sunny Optical (2382) 28%, Link REIT (823) 28%, SHKP (16) 28%, Lenovo (992) 27%, HSBC (5) 27%, Bud APAC (1876) 27%, CK Asset (1113) 27%, NTES-S (9999) 26%, CM Bank (3968) 26%, MTRC (66) 26%, China Overseas (688) 26%, AIA (1299) 25%, Xinyi Glass (868) 25%, Hansoh Pharma (3692) 25%.

WATCH
Henderson Land's (0012) New Central Harbourfront development has won approval to build three buildings with a gross floor area of 1.75 million square feet. The Buildings Department granted approvals to 22 sets of building plans in August, nine of which were for residential/commercial developments, and five for purely commercial use. The most notable project approved is the commercial property, New Central Harbourfront Site 3 Project in Central, owned by Henderson Land. 

Approval also given to Urban Renewal Authority's Hong Fook Street/Kai Ming Street redevelopment in To Kwa Wan, which was acquired by CK Assets (1113) for nearly HK$6 billion last year. Site A within this project has been approved for the construction of two 27-story mixed-use buildings, along with three platform levels and one basement level. 

EVERGRANDE (03333.HK)  has not filed its defence documents as instructed by Hong Kong's High Court before the winding-up petition hearing next Monday (30 Oct), Reuters reported, citing sources. It's not clear whether EVERGRANDE will file the documents in the next few days, or whether it will move to adjourn the hearing again. However, lawyers said the failure to update the judge on the progress of the reorganisation plan could increase the chances of it being ordered to wound up.  At the end of July, EVERGRANDE announced that the High Court had granted an adjournment of the petition hearing to 30 October in light of the latest developments in its offshore restructuring. Last week, EVERGRANDE had made another announcement that it was in the process of amending the terms of the proposed offshore debt restructuring agreement to meet the objective circumstances of the company and the requirements of its creditors. The Court had then granted approval for certain hearings to be vacated or adjourned indefinitely.

The Centa-salesman Index (CSI) (Residential Property Prices) last printed at 38.38, up 0.93 points from last week's 37.45, approaching 40, reflecting the market situation before the announcement of new Policy Address. Yeung Ming Yee, senior associate director at Centaline Property Research, said that, since the Financial Secretary's hint in late September that the property market might be expected to see a relaxation in spicy measures, the CSI has stabilized significantly, rising for 4 consecutive weeks by a total of 5.11 points.  This showed that the market believes that the relaxation of spicy measures will help to boost the property market. Some buyers accelerated their entry into the market, making a slight increase in the number of second-hand transactions, which slightly improved the atmosphere in the short term. 

In response to the "less spicy" housing policy propounded in the new Policy Address, Shih Wing Ching, Founder and Chairman of Centaline Group, opined that since the property market has deteriorated notably, there is a greater need to lure investors to enter the market, and the relaxation on "spicy" measures should be more aggressive; however, the government is still taking a stance of "penalizing investors" in today's policy. That being said, the stamp duty suspension arrangement for incoming talents' acquisition of residential properties comes as a surprise to Shih, who viewed it as one of the more "drastic move" of the three relaxation measures.

After the Hong Kong government released the 2023 Policy Address today (25th), Dorothy Chow, an Executive Director of valuation and advisory services at Colliers, pointed out that the government's effort to "reduce spicy measures" is insufficient, and there is a gap with the market's expectations. Back then, the government introduced the spicy measures to curb speculation in the property market, and the main factors affecting property prices are the interest rate, the local economic situation and the purchasing power of the public. However, property prices have now fallen about 15% from the 2021 high level. Prospective buyers remain conservative due to high interest rates and slower-than-expected recovery of the local economy. It is estimated that prices will continue to fall in the remaining two months of 2023, resulting in a 4% to 5% drop in property prices for the whole year, and the downward trend of property prices may continue to 2024. Colliers estimated that there will be a chance that the property prices of small and medium-sized private homes will drop by 10% in 2024.

HSBC welcomes a number of measures in the 2023 Policy Address to stimulate Hong Kong economy and innovative investment. Luanne Lim, Chief Executive Officer, HSBC Hong Kong, said that whether it is to attract overseas enterprises and talents, promote international trade, sustainable finance and even the RMB internationalization, it is believed that the relevant measures can further enhance Hong Kong's position as an international finance center, which, together with the reliable financial infrastructure, efficient capital market and comprehensive finance services, can meet the needs of overseas and Chinese enterprises.

The Securities and Futures Commission (SFC) welcomes the initiatives in the Chief Executive’s Policy Address to enhance Hong Kong’s competitiveness and upholding its status as an international financial centre. The SFC's Chairman, Tim Lui, said they fully support the measures outlined by the Chief Executive. As to Lee's adoption of the recommendations by the Task Force on Enhancing Stock Market Liquidity, the SFC will work closely with HKEX (00388.HK) to examine how to implement these recommendations.  The SFC also welcomes the measures proposed by the Chief Executive seeking to strengthen Hong Kong’s offshore renminbi business, deepen financial cooperation in the Greater Bay Area, establish a new platform to expand fund distribution and to promote green and sustainable finance in Hong Kong.  The SFC believes deepening mutual market access between Hong Kong and the Mainland and stepping up financial cooperation in the Greater Bay Area will further cement Hong Kong’s unique role in connecting international investors with the Mainland markets as well as promoting the continuing opening-up of the Mainland capital market, Lui added.

The Hong Kong Institute of Bankers (HKIB) expressed its support for a series of talent-related measures mentioned in the new Policy Address, including enhancing the development of Hong Kong's asset and wealth management business, promoting the cooperation and talent exchange with China financial markets, focusing on "attracting and retaining talents" and expanding the professional talents pool.

At the Lenovo Tech World organized by LENOVO GROUP (00992.HK), Group Chairman and CEO Yang Yuanqing and NVIDIA Founder and CEO Jensen Huang jointly announced that the two companies will join forces to launch hybrid AI solutions.  At the same time, LENOVO also announced that it will work with Intel  to promote the large-scale application of AI in workloads such as the client, network and cloud, and will continue to collaborate with AMD (AMD.US)    in the areas of smart devices, infrastructure and solutions.

Chinese media quoted sources from Sinopec as saying that, as of 23 October, Sinopec's natural gas branch has formed a gas storage reservoir with an effective working capacity of over 2.5 billion cubic meters, which can satisfy the gas demand of 160 million households for a month, which has solidified the resource base for the guaranteed supply season this winter and next spring.

Temu, the cross-border e-commerce platform of PDD Holdings Inc. (PDD.US), recorded sales exceeding US$5 billion in 3Q23. On the first anniversary of its launch, the single day GMV even reached US$80 million. It is expected that Temu may exceed its annual GMV target of US$15 billion or even reach US$18 billion this year.

WEY, the premium brand of GWMOTOR (02333.HK), recently announced the launch of its first MPV product, "WEY Gaoshan", which is available in 3 models, namely Premium, Flagship and Executive Plus, with prices ranging from RMB335,800 to RMB405,800.  Mu Feng, President of GWMOTOR, remarked that WEY already splurged RMB500 million to develop the world's first dedicated platform for high-end new energy MPVs, whereas the launch of the Gaoshan MPV will mark the rebranding of WEY and an important step towards the development of a new category of MPVs for GWMOTOR.

Tencent Smart Retail announced that Yiwu Industry AI Application Conference was officially held on Sunday (22nd). At the conference, Yiwu Commodities City Group (i.e. Zhejiang China Commodities City Group) and Tencent Smart Retail officially entered into a strategic cooperation agreement. Tencent will provide Yiwu Commodities City Group with fully connected digitalization solutions, including research and development (R&D) design, brand incubation, fashion intelligent manufacturing, exhibition and trade, digital marketing, and fulfillment services, and the two parties will jointly promote the digitalization and upgrading of chinagoods.com.

EUROPE & US RECAP
DAX 0.08%, CAC 0.31%, FTSE 0.33%
Markets opened flat and initially dipped slightly and then traded most of the day around flat before dipping mid afternoon before rebounding into the close.

Earnings in focus Mining stocks rose 0.9% to lead gains, while retail stocks fell 1.3%.

Deutsche Bank 8.2% higher; reported a third-quarter net profit of 1.031 billion euros ($1.06 billion), beating expectations despite an 8% fall on the previous year and ongoing struggles in the lender’s investment unit.

Earnings were out from Heineken, AkzoNobel, Lloyds Banking Group and Carrefour. 

DOW -0.32%, NDX -2.43%, S&P -1.43%, Russel 2K -1.67%
US markets opened mixed DOW slightly higher but then traded around flat but eased lower from midday and traded sideways in the red in the afternoon. S&P and NDX opened lower and trended lower to early afternoon and then traded flat into the close.  S&P closed below 4,200 the lowest since May after disappointment from Alphabet down 10% as cloud missed

Shares of Microsoft jumped after stronger-than-expected results in the fiscal first quarter, while Alphabet shares tumbled as its cloud business missed analysts’ estimates.

Data on Wednesday showed sales of new U.S. single-family homes surged to a 19-month high in September as the annual median house price dropped by the most since 2009 amid discounts offered by builders to woo buyers, but mortgage rates flirting with 8% could curb demand.

After Market Morgan Stanley says Ted Pick will succeed James Gorman as CEO on Jan. 1

Banks JPMorgan Chase -0.77%, Citigroup -0.32% Wells Fargo -0.26%, Amex -0.9%
Ecommerce Meta -13.02%, Apple -2.34%, Amazon -7.17%, Netflix -2.48%,  Disney -1.97%, Zoom Video 1.79%, Alphabet -13.45% and Microsoft 10.14%,
Tech NXP Semi -7.67%, Nvidia -18.84%, Micron -1.57%, AMD -5.61%, Skyworks -2.95%
Industrial/Discretionary  Boeing -4.63%, Caterpillar -4.61%, Simon Property -0.99%, Kohl’s -0.07%, Nordstrom -3.16%, Gap 0.65%, United Airlines -0.29%, Carnival -0.18%, Wynn Resorts -2.48%
Energy Chevron -0.78%, Exxon Mobil 0.2%,  
Consumer Staples Campbell Soup 1.3% General Mills 2%, JM Smucker 1.97%

DAILY DATA
USD strong to a week high, Bitcoin 2.29% @ 34,567.60,  VIX 6.43% @ 20.19,  US T10 up 11 bpts at 4.954% and T2 flat at 5.1% 
OIL Brent 2.34%, WTI 1.97%  on worries about conflict in the Middle East, but upside capped by higher U.S. crude inventories and gloomy economic prospects in Europe.
Gold -0.18%, Silver -0.1%, Copper -0.21% Platinum 0.04%, Palladium flat.