APAC Market Wrap - Nov 25

Mainland China stock market: At the close, the Shanghai Composite rose 0.87%, the Shenzhen Component rose 1.53%, and the ChiNext Index rose 1.77%.

 

In terms of sectors, gaming, AI applications, CPO, precious metals and other sectors led the gains, while military equipment, aquaculture and other sectors were among the biggest decliners.

 

Hong Kong stock market: Hong Kong stocks extended their rally today, with the tech index leading the gains. At the close, the Hang Seng Index rose 0.69% to 25,894.55; the Tech Index rose 1.20% to 5,612.03; the H-Shares Index rose 0.87% to 9,158.31.  

 

From market performance, internet & tech, gold, insurance, lithium batteries, autonomous driving and related stocks all performed strongly.

 

Japanese stock market: The Nikkei 225 rose 0.07%, or 33.64 points, to close at 48,659.52. In terms of sectors, non-ferrous metals, mining, electricity and other sectors rose, while information & communication, insurance, air transportation and other sectors fell.

 

Korean stock market: The KOSPI rose 0.30% to 3,857.78. Utilities, electronic equipment, non-ferrous metals and other sectors gained, while pharmaceuticals, tobacco, airlines, internet, hotels and other sectors declined.

 

Australian stock market: The S&P/ASX 200 rose 0.14% to 8,537.000. Aerospace, agriculture, semiconductors, industrials and other sectors rose, while homebuilding, forestry products, insurance and other sectors fell.

 

Singapore stock market: The FTSE Singapore Straits Times Index STI fell 0.24% to 4,485.63. By sector, oil & gas, transportation, cyclical retail and other sectors rose, while personalized services, software, apparel, education and other sectors declined.

 

Malaysian stock market: The FTSE Malaysia KLCI fell 0.43% to 1,611.74. By sector, business trusts, real estate, technology and other sectors rose, while consumer products & services, telecommunications & media and other sectors edged lower.

Key events  

Malaysia plans to ban social media use for those under 16  

 

The Malaysian government plans to impose age restrictions on social media users, banning teenagers under 16 from using social media starting next year.  

 

Malaysian Communications Minister Fahmi Fadzil said on the 23rd that the government is studying practices in countries such as Australia and hopes to implement the restrictions next year to protect juveniles from cyberbullying, scams, etc. At that time, under Malaysian government regulations, social media platforms will prohibit those under 16 from opening accounts.  

 

Fahmi Fadzil posted a video on the website of Malaysia’s The Star saying that as long as the government, regulators and families “each fulfill their responsibilities,” Malaysia’s internet environment can be fast and safe.

 

SoftBank shares plunge amid fears its OpenAI investment faces intensifying competition  

 

SoftBank Group shares tumbled on Tuesday, hitting an 11-week low, as the market worried that Alphabet’s newly released Gemini AI model could intensify competition with OpenAI — a core investment of the Japanese conglomerate.  

 

After plunging 10.9% on the last trading day before Japan’s long weekend, SoftBank shares fell again on Tuesday, down as much as 11% intraday. Meanwhile, other Japanese AI-related stocks, including Advantest, generally followed global chip stocks higher.  

 

“The market is concerned that after Google’s Gemini 3 received widespread praise, OpenAI’s competitive environment will become much tougher,” said Tsutomu Yamada, market analyst at Mitsubishi UFJ eSmart Securities Co.

 

South Korea’s ruling party plans to propose bill to boost U.S. investment under tariff agreement  

 

South Korea’s ruling Democratic Party will introduce legislation this week aimed at facilitating Korean investment in the United States under an agreement that lowers tariffs on Korean exports.

Institutional views 

Morgan Stanley: If the Fed cuts rates consecutively, USD/JPY could fall nearly 10% in coming months  

 

Morgan Stanley strategists said that with signs of a U.S. economic slowdown, the Fed is likely to cut rates consecutively in this context, and the dollar could depreciate nearly 10% against the yen in the coming months.  

 

Strategists including Matthew Hornbach wrote in a report on Sunday that as USD/JPY moves back toward its interest-rate-implied fair value, combined with U.S. rate cuts causing that fair value itself to decline, the pair could fall nearly 10% in the coming months.  

 

The bank also noted, “Japan’s fiscal policy stance is not particularly loose. As the U.S. economy recovers, demand for carry trades is expected to increase, and the yen will face renewed downward pressure in the second half of next year.”

 

Goldman Sachs: Expects Fed to cut rates in December  

 

Goldman Sachs economists expect the Fed to cut rates in December, bringing the policy rate to slightly above 3%. Chief economist Jan Hatzius warned that the U.S. slowdown may be larger than expected, requiring more Fed cuts.

 

He noted that although September nonfarm payrolls added 119,000 jobs, rising layoffs suggest labor market weakness may be solidifying, limiting the impact of moderate growth.

 

Bank of America: Gold price could reach $5,000/oz by 2026  

 

Bank of America says gold could hit $5,000 per ounce by 2026, believing the drivers behind the recent surge will persist. Strategists led by Michael Widmer see gold as “overbought” but still “under-invested,” supported by unusual U.S. economic policy.

 

BofA forecasts an average gold price of $4,538/oz next year, citing tight mine supply, low inventories and imbalanced demand as key reasons. The bank also raised 2026 price forecasts for copper, aluminum, silver and platinum but said palladium remains oversupplied.

 

Deutsche Bank: S&P 500 target could reach 8,000 by end-2026  

 

Deutsche Bank Research says AI-driven gains will continue strongly into 2026, with the S&P 500 potentially breaking through 8,000 by year-end. Global macro and thematic research head Jim Reid said on Monday: “Rapid investment and adoption in AI will continue to dominate market sentiment.

 

Given the blistering pace of technological progress, we have good reason to believe this will translate into meaningful productivity gains.

 

However, determining ultimate winners and losers depends on a complex interplay of many factors, some of which may not become clear until after 2026.” Reid added, “Our U.S. equity strategist (the most bullish analyst on the team) has set an 8,000 year-end target that deserves particular attention given their strong historical track record.”

 

HSBC: Now is a good time to add risk assets  

 

Stocks — especially tech — have been jittery lately, but HSBC’s multi-asset strategists believe it’s time to buy. HSBC notes that while the S&P 500 is less than 5% from all-time highs, sentiment and positioning have clearly deteriorated.

 

High-yield spreads have widened less than 30 bps since October, and EM spreads are still tightening, making the past few weeks feel odd. They point out that the VIX futures curve now shows a spot premium — unusual — meaning traders see near-term markets as more uncertain than longer-term ones.

 

Most attribute this to concerns over the most speculative parts of the market, yet bottom-up consensus still expects ex-tech S&P 500 earnings to fall 8% quarter-over-quarter. They say, “Such low expectations actually set a lower bar for Q4 earnings season early 2026, while a December Fed cut should help ease tensions and improve sentiment.” HSBC concludes: “This creates a good environment for adding rather than reducing risk exposure.”