APAC Market Wrap – Dec 8
Mainland China stock market: At the close, the Shanghai Composite rose 0.54%, the Shenzhen Component rose 1.39%, and the ChiNext Index rose 2.6%.
In terms of sectors, computing hardware, energy metals, Fujian and others led the gains, while coal, precious metals, oil & gas and others were among the biggest decliners.
Hong Kong stock market: Hong Kong’s three major indices showed divergent performance today. At the close, the Hang Seng Index fell 1.23% to 25,765.36 points; the Hang Seng Tech Index closed flat at 5,662.55 points; the H-Shares Index fell 1.25% to 9,083.53 points.
From market performance, brokerages, semiconductors and battery-related stocks performed strongly, while gold and coal stocks generally weakened.
Japanese stock market: The Nikkei Index rose 0.18% to 50,581.94 points.
By industry, non-ferrous metals, real estate, wholesale and many others rose, with only a few such as retail and banking declining.
Korean stock market: The KOSPI rose 1.34% to 4,154.85 points.
Electrical products, chemicals, aerospace, non-ferrous metals and others rose, while insurance, biotech, energy, diversified telecom services and others fell.
Australian stock market: The S&P/ASX 200 fell 0.12% to 8,624.400 points.
Industrial distribution, credit, media and others rose, while semiconductors, industrial products, energy and others declined.
Singapore stock market: The FTSE Singapore Straits Times Index STI fell 0.54% to 4,507.08 points.
Industrial distribution, personalized services, insurance and others rose, while medical distribution, industrial products, forestry products and others declined.
Malaysian stock market: The FTSE Malaysia KLCI fell 0.23% to 1,612.78 points.
Medical insurance, telecom & media, real estate and others rose, while transport & logistics, consumer goods, energy and others edged lower.
Key Events
Japan Q3 GDP downgraded! Economists say unlikely to affect BOJ December hike
Japan’s Cabinet Office released revised data on Monday (Dec 8) showing the economy contracted at an annualized 2.3% pace from July to September, a quarterly decline of 0.6%. The downgrade came after incorporating new economic data released last week, with capital spending weaker than preliminary figures – both corporate spending and housing investment underperformed.
This is the fastest contraction since Q3 2023 and worse than last month’s preliminary estimate (annualized -1.8%, quarterly -0.4%). Despite soft data, economists believe it is unlikely to alter the BOJ’s gradual hiking path, with a December hike still highly probable.
Korea expects full-year exports to exceed $700 billion for the first time
Government data released Sunday shows Korea’s 2025 exports are expected to break $700 billion for the first time, a record high, though non-semiconductor exports are projected to decline year-on-year.
According to the Ministry of Trade, Industry and Energy, January-November exports totaled $640.2 billion, up 2.9% YoY – the highest for the period on record (previous high: $628.7 billion in 2022).
The government expects full-year exports to top $700 billion for the first time.
LG Energy Solution signs >2 trillion KRW battery supply deal with Mercedes-Benz
Korean battery maker LG Energy Solution said Monday it has signed a 2.06 trillion KRW (~$1.39 billion) battery supply agreement with Mercedes-Benz Group.
LGES said in a regulatory filing that deliveries under the contract will begin in March 2028 and run through June 2035.
Institutional Views
BofA notes that despite cautious Fed signals, markets could soon price in a January cut more aggressively. The bank expects a 25 bps cut in December with tougher guidance and multiple dissents, plus economic projections showing stronger growth and lower inflation.
BofA believes with a lot of data coming before January, Powell will struggle to push back on further easing expectations. Analysts say Powell is unlikely to change market “data-dependent” expectations amid focus on upcoming data.
Barclays economists wrote that the BOT may be quite resistant to hiking next year. Growth prospects for 2026 are expected to remain below potential, with inflation likely still under the 1%–3% target range. The BOT’s focus is on maintaining loose policy, and the governor wants the central bank to play a larger role in addressing structural economic issues.
Economists say even if price pressures rise, the BOT is unlikely to shift stance. They note inflation typically ranks low in the BOT’s priorities, behind growth and financial stability.
CITIC Securities: Clear medium- to long-term allocation logic for copper, aluminum, gold
CITIC Securities notes that since Q4, rising global macro and geopolitical uncertainty has highlighted the investment value of strategic mineral resources in security and price elasticity. Based on current supply-demand patterns, policy direction, and industry trends, copper, aluminum, and gold have clear medium- to long-term allocation logic.
Copper benefits from tight mine supply and green economy demand; aluminum is constrained by domestic capacity ceilings while benefiting from lightweighting and green power demand; gold has unique risk-hedging and inflation-hedging attributes.
CITIC Securities: AI large models and applications continue evolving – continue recommending AI compute power sector
CITIC Securities notes AI large models are still iterating with the overall picture unsettled, while AI applications also continue developing. Whether on phones or glasses, they could trigger phased rallies worth ongoing attention.
Recent catalysts in the AI chain are constant: Google’s new model with major performance gains and strong TPU capabilities, DeepSeek V3.2 release, Amazon’s Trainium3 launch, high participation enthusiasm shown by Moore Threads’ listing, plus denials of AI bubble from more companies including Nvidia, Alibaba, AMD – all demonstrating AI’s strong development prospects. Continue recommending the AI compute power sector.