APAC Market Wrap - 29 Sep
China Stock Market: At the close, the Shanghai Composite rose 0.90%, the Shenzhen Component gained 2.05%, and the ChiNext Index climbed 2.74%.
Sectors like securities, nonferrous metals, and solid-state batteries led gains, while education, pork, and coal saw the biggest declines.
Hong Kong Stock Market: Hong Kong’s three major indices surged today. At the close, the Hang Seng Index jumped 1.89% to 26,622.88 points, the Tech Index rose 2.08% to 6,324.25 points, and the China Enterprises Index increased 1.62% to 9,454.12 points.
Brokerages, gold, nonferrous metals, steel, robotics, and energy storage stocks performed strongly.
Japan Stock Market: The Nikkei 225 fell 0.69%, closing at 45,043.75 yen, down 311.24 yen from the previous day.
Except for nonferrous metals, all 32 other sectors declined, with shipping, transportation equipment, securities/futures, and banking seeing notable drops.
South Korea Stock Market: The KOSPI rose 1.33% to 3,431.21 points.
Venture capital, interactive media, display panels, and cosmetics led gains, while education services, diversified communication services, cigarettes, and diversified consumer services lagged.
Australia Stock Market: The S&P/ASX 200 gained 0.85% to 8,862.80 points.
Aerospace, industrial products, biotechnology, and banking rose, while furniture, semiconductors, agriculture, and alternative energy saw sharp declines.
Singapore Stock Market: The Straits Times Index edged up 0.15% to 4,272.34 points.
Cyclical retail, steel, interactive media, and oil/gas surged, while forestry products, industrial distribution, furniture, and education fell significantly.
Malaysia Stock Market: The FTSE Malaysia KLCI rose 0.12% to 1,610.95 points.
Commercial trusts, closed-end funds, and communication/media gained, while construction, industrial products/services, and energy declined.
Key Events
Trump’s $900B Funding Push Faces Resistance: South Korea and Japan Cautious
Donald Trump’s efforts to secure large investment commitments from Asian allies hit a snag. South Korea called U.S. demands unrealistic, while Japan’s ruling party leadership candidates hinted at revisiting agreements.
South Korea’s National Security Advisor Wi Sung-lac told Channel A News on Saturday, “We can’t pay $350 billion in cash. Objectively, it’s beyond our capacity.”
Bank of Korea: Adverse Weather Drags 2025 Private Consumption Growth
The Bank of Korea said Monday that extreme heatwaves and other weather conditions cut annual private consumption growth by ~0.09 percentage points this year.
A report noted Q1 cold snaps and summer heat reduced growth by 0.03% and 0.15%, respectively, though below-average rainfall boosted growth by 0.09%.
Japan Consumers Face “Tough October”: Over 3,000 Food Items to Rise, Insurance and Utilities Up
October will be rough for Japanese consumers as rising raw material and labor costs drive price hikes for over 3,000 food and beverage items—the largest wave in six months.
Car insurance rates will also increase, and three-month electricity and gas subsidies end in September, adding pressure to household budgets.
OPEC+ Meeting Looms: Group May Raise Oil Output Again in November
OPEC+ is likely to approve another oil output increase at next week’s meeting as rising prices push the group to reclaim market share.
The eight-member group, accounting for ~50% of global oil production, will meet online October 5 to set November output. Three sources familiar with talks say OPEC+ may boost production by at least 137,000 barrels per day.
Gold Hits Record High as Traders Weigh U.S. Government Shutdown Risk
Precious metals surged Monday, with gold reaching a record $3,798.73 per ounce, up 1%, topping last Tuesday’s high after six weeks of gains.
Silver rose 1.2%, and platinum and palladium also climbed, driven by tight supply and inflows into precious metal ETFs. Traders fear a U.S. government shutdown could delay key jobs data, clouding the Fed’s policy path.
Australia Central Bank Likely to Hold Rates, Policy Easing Room Narrows
The Reserve Bank of Australia is expected to keep rates steady this week, with traders and economists noting a tight job market and new inflation pressures limiting further easing. A Bloomberg survey predicts the RBA will hold the cash rate at 3.6% on Tuesday after its third cut this year in August.
The median forecast sees one more cut in November, then a pause until Q3 2026, shifting from earlier expectations of two cuts by early 2026.
Apple CEO Tim Cook Confirms He’s a Crypto Investor, Holds Bitcoin
At the New York Times DealBook Online Summit, Apple CEO Tim Cook confirmed he invests in cryptocurrencies, holding Bitcoin and Ethereum.
Cook said his crypto holdings are for portfolio diversification, calling the allocation “reasonable” after thorough research.
Institutional Views
HSBC: China Stocks to Rise 17-20% by 2026
HSBC Global Research predicts the Shanghai Composite will hit 4,500, CSI 300 will reach 5,400, and Shenzhen Component will climb to 16,000 by 2026, up 17-20%. The optimism assumes no U.S. recession, sustained AI-related capital spending, and further Fed rate cuts.
HSBC expects corporate earnings to rebound in 2026, led by electronics, with ample liquidity providing support.
Fidelity International: Global Investors Boost China Stock Holdings
Goldman Sachs noted that global hedge funds’ activity in China’s onshore stock market last month was the highest in years, contrasting with 2021 when some called China “uninvestable.” PIMCO said investors are shifting from risk fears to FOMO.
Official data shows rising foreign inflows across asset classes, a trend seen only three times in the past decade. “Global interest in Chinese assets is clearly growing,” said Fidelity’s portfolio manager Joseph Zhang, who’s been adding to China stocks. “This year’s different—China’s revaluation isn’t policy-driven hype but fundamental improvement. Investor confidence may strengthen further.”
Barclays: Gold Prices Not Overvalued, ETF Holdings at 2022 Highs
Barclays strategists said Sunday that gold prices don’t seem overvalued relative to the dollar and U.S. Treasuries, and a Fed independence risk premium is warranted.
Gold is up over 40% this year, fueled by central bank demand and Fed rate cuts, set for a third straight quarterly gain. Banks like Goldman Sachs and Deutsche Bank expect the rally to continue.
Nomura: RBA to Hold Rates, May Shift to Less Dovish Tone
Nomura’s chief economist Andrew Ticehurst expects the RBA to keep the cash rate unchanged on Tuesday, likely unanimously. Compared to August, the RBA’s tone may turn less dovish, with stronger GDP growth, low unemployment, and rising inflation.
The RBA forecasts Q3 and Q4 core CPI (trimmed mean) at ~0.65% quarter-on-quarter, but Ticehurst sees Q3 at 0.95%.
Nomura: USD/JPY Volatility May Rise with Data and Events
Nomura’s global FX strategy report said USD/JPY volatility could increase amid a busy week of Japan and U.S. data and events. Japan’s focus is Wednesday’s BOJ Tankan survey, which may show modest manufacturing confidence improvement and sustained rate hike expectations.
BOJ officials’ speeches will be watched for shifts in economic and inflation views. In the U.S., markets eye whether Congress passes a continuing resolution by Tuesday’s deadline to avoid a shutdown. Nomura expects USD/JPY to fluctuate between 146.50-151.50 this week.
Capital Economics: Tokyo CPI Won’t Stop BOJ from Hiking in October
Capital Economics said softer-than-expected Tokyo CPI overstates slowing inflation nationwide. While it reduces October rate hike odds, Tokyo’s September CPI dip is due to free childcare measures, part of broader price relief efforts.
This is expected to lower national inflation by ~0.7 points, with core inflation (ex-fresh food and energy) falling from 3.3% to 3.1%. Capital Economics maintains the BOJ will resume tightening in October.