APAC Market Wrap – Dec 17

Mainland China stock market: At the close, the Shanghai Composite rose 1.19%, the Shenzhen Component rose 2.4%, and the ChiNext Index rose 3.39%.

 

In terms of sectors, energy metals, computing hardware, batteries, insurance and others led the gains, while Hainan, defense and others were among the biggest decliners.

 

Hong Kong stock market: Hong Kong’s three major indices all rebounded. At the close, the Hang Seng Index rose 0.92% to 25,468.78 points; the Hang Seng Tech Index rose 1.03% to 5,457.95 points; the H-Shares Index rose 0.98% to 8,843.57 points.  

 

From market performance, optical communications, aviation, lithium batteries, gold, autonomous driving and others strengthened.

 

Japanese stock market:The Nikkei Index rose 0.26% to 49,512.28 points.  

 

By industry, insurance, non-ferrous metals, shipping and others rose, while fisheries, oil, rubber products and others declined.

 

Korean stock market:The KOSPI rose 1.43% to 4,051.41 points.

 

Semiconductors, roads, electronics, household products and others rose, while healthcare, tobacco, biotech and others declined.

 

Australian stock market:The S&P/ASX 200 fell 0.16% to 8,585.200 points.

 

Homebuilding, waste management, steel and others rose, while aerospace, alcoholic beverages, healthcare services and others declined.

 

Singapore stock market:The FTSE Singapore Straits Times Index STI fell 0.09% to 4,575.48 points.

 

Personalized services, utilities, semiconductors and others rose, while industrial products, alcoholic beverages, medical equipment and others declined.

 

Malaysian stock market:The FTSE Malaysia KLCI rose 0.36% to 1,643.72 points.

 

Tech, energy, construction and others rose, while transport & logistics, telecom & media, financial services and others edged lower.

Key Events  

Major signal! SpaceX reportedly notifies employees of pre-IPO quiet period  

 

Latest news indicates U.S. rocket and satellite internet leader SpaceX has notified employees the company is entering a “regulatory quiet period” — a key signal that the largest IPO in Earth’s history is gradually starting.  

 

Sources familiar with internal emails told media that SpaceX has instructed employees not to comment, discuss, or promote the company’s public listing plans in compliance with SEC rules, including topics like growth prospects or valuation.  

 

The “gag order” covers social media, interviews, conferences, and public appearances.

 

“Apple supply chain” big event! Apple considering chip packaging in India for first time – talks underway  

 

On Wednesday Eastern Time, foreign media reported Apple is in preliminary talks with Indian chip manufacturers to assemble and package components for iPhones.  

 

Previously, Apple’s cooperation with India focused mainly on final assembly of end products like iPhones and AirPods. The latest talks suggest Apple’s India layout may extend upstream from terminal assembly to more complex semiconductor packaging.

 

Thailand bans transport of oil and strategic materials to Cambodia  

 

On the 17th local time, Thailand’s Defense Ministry announced a ban on transporting oil and strategic materials to Cambodia, to be implemented at ports in 23 coastal provinces. Cambodian vessels are also prohibited from entering Thai waters or ports.

Institutional Views  

Capital Economics: If AI hype continues fading, Chinese stocks may outperform U.S. stocks next year  

 

Capital Economics market head Thomas Mathews wrote that if the AI boom keeps cooling, Chinese stocks could perform better than U.S. stocks. Concerns over U.S. tech stocks are resurfacing, with the S&P 500 down nearly 2% from last week’s peak.

 

Goldman Sachs: Fed may cut more aggressively next year – nonfarm totals no longer primary indicator  

 

Goldman Sachs expects the Fed may be more willing to cut further next year than markets previously assumed. Global Banking & Markets Chief Strategist and Financial Risk Head Josh Schiffrin said last week’s Powell press conference signaled growing internal Fed concern over employment sustainability.

 

While the base case remains holding rates and assessing data, Schiffrin believes the bar for additional cuts may be lower than pre-meeting worries. Upcoming employment reports will be key to resuming easing, with markets focusing on unemployment rate rather than headline nonfarm payrolls.

 

Looking ahead, Goldman expects easing to extend into 2026, with the federal funds target potentially to 3% or lower — reflecting mild inflation and rising labor slack providing room to remove remaining policy restraint.

 

Morgan Stanley: Gold upside to narrow next year, silver to underperform gold  

 

Morgan Stanley said Tuesday that as central banks and ETFs reduce gold buying, gold price gains will narrow in 2026, though expected rate cuts and dollar weakness will keep upward momentum. The bank forecasts gold at $4,800/oz by Q4 2026, citing stronger Chinese retail demand, central-bank buying, and global growth worries.

 

Meanwhile, silver will lag gold as solar installations fall in 2026 and silver shortage peaks in 2025. Finally, Morgan Stanley forecasts platinum at $1,775/oz and palladium at $1,325/oz in 2026, reflecting structural imbalances and demand shifts.

 

BofA survey shows more investors view dollar as overvalued  

 

Bank of America’s latest global fund manager survey shows more investors see the dollar as overvalued in December. ~53% think the dollar is overvalued, up from 45% in November. The survey also shows investors remain underweight dollar vs history. Short dollar is the third-most crowded trade. Long “Magnificent Seven” (seven major tech giants including Apple and Alphabet) is the most crowded, followed by long gold.

 

BofA survey shows AI bubble concerns eased but still high  

 

Bank of America’s global fund manager survey shows investor AI bubble worries eased slightly but remain elevated. Most respondents still see AI bubble as the top “tail risk” (low-probability high-impact event), at 38% (down from 45% in November). 19% see disorderly bond yield rise as top tail risk. Private credit emerged as a new risk, with 14% of managers citing it as the biggest tail risk next year.

 

ING: BOJ hike odds rising, but governor unlikely to sound hawkish  

 

ING senior economist Min Joo Kang wrote that strong Japanese exports raise BOJ hike odds Friday. November exports grew for the third straight month, October core machinery orders surged for the second month. Data suggests recovery from last quarter’s contraction. Markets will watch Governor Ueda’s comments. With growing concerns over rising market rates, we expect Ueda won’t send hawkish signals at the press conference.