APAC Market Wrap - 18 Jul

China: Markets oscillated with mixed results, the Shanghai Composite hit a yearly closing high, while the ChiNext Index peaked then retreated. At close, the Shanghai Composite rose 0.5%, the Shenzhen Component gained 0.37%, and ChiNext edged up 0.34%.

 

Sectors like rare earth magnets, lithium, non-ferrous metals, and coal led gains, while gaming, photovoltaics, CPO, and consumer electronics lagged.  

 

Hong Kong: All major indices rose, with the Hang Seng up 1.33%, the Hang Seng Tech Index up 1.65%, and the State-Owned Enterprises Index up 1.51%. Tech stocks rallied, non-ferrous metals advanced, stablecoin concepts gained, brokerage stocks climbed, gold stocks rose, and AI concepts shone.  

 

Japan: The Nikkei 225 fell 0.21% to 39,819.11 yen (estimated volume 148 million shares), down 82.08 yen. Eleven sectors, including information communication, securities, commodities futures, non-ferrous metals, and food, rose, while 22 sectors like real estate, air transport, pulp and paper, steel, and machinery declined.  

 

South Korea: The KOSPI dipped 4.22 points, or 0.13%. Chemical, electrical products, and retail sectors rose, while internet, life insurance, and cosmetics sectors fell.  

 

Australia: The S&P/ASX 200 rose 1.37% to 8,757.20 hits record high,Biotechnology, credit, and oil & gas sectors led gains, while other energy, aerospace, and forestry products lagged.  

 

Singapore: The Straits Times Index gained 0.67% to 4,189.50. Apparel, non-alcoholic beverages, and industrial products topped gains, while regulated utilities, transportation, and healthcare saw larger drops.  

 

Malaysia: The Malaysia Index rose 0.32% to 1,525.86. Construction, real estate, and closed-end funds saw modest gains, while real estate investment, telecom & media, and consumer services declined.  

Key Events  

EU Approves New Russia Sanctions  

 

Post-Slovakia’s veto lift, EU nations greenlit a new sanctions package against Russia, including revised oil price caps, new bank restrictions, and measures to ensure Nord Stream remains offline. The 18th package since the Russia-Ukraine conflict cuts ~20 Russian banks from SWIFT and imposes full transaction bans.  

 

Japan June Inflation Persists, Rice Prices Still Double  

 

Friday’s data shows Japan’s rice prices eased slightly but remain nearly double year-over-year. Inflation moderated from last month but exceeds the Bank of Japan’s 2% target, with economists warning of further upside risks.  

 

South Korean President Yoon Meets Hyundai, LG Chiefs  

 

The presidential office said Friday that President Yoon Suk Yeol met Hyundai Motor Group Chairman Chung Eui-sun and LG Group Chairman Koo Kwang-mo this week to discuss business and trade, dining with them on Monday and Tuesday.  

Institutional Views  

Goldman: Overseas Cornerstone Investors Drive HK IPOs, Contribute 42% of Funds  

 

On July 17, Goldman Sachs’ latest report noted a 2025 HK IPO boom, with cornerstone investors key. They account for 42% of total IPO funds, two-thirds from overseas, signaling a sharp rise in global capital demand for Chinese assets.  

 

Morgan Stanley: U.S. Stocks to Kick Off New Bull Run, But May Drop 5%-10% This Quarter  

 

Mike Wilson, Morgan Stanley’s chief investment officer and ex-Wall Street bear, now sees a new U.S. bull market brewing. In a Thursday interview, he predicts a 5-10% S&P 500 dip this quarter due to Trump’s trade policies hitting corporate balance sheets.

 

He views this as a short-term pullback, offering an attractive entry for gains driven by improved earnings outlooks.