APAC Market Wrap – Dec 29
Mainland China stock market:At the close, the Shanghai Composite rose 0.04%, the Shenzhen Component fell 0.49%, and the ChiNext Index fell 0.66%. From a sector perspective, robotics concepts remained active in the afternoon, commercial aerospace continued strong. On the downside, batteries, dairy, power and others led declines.
Hong Kong stock market:Hong Kong stocks showed structural differentiation today, with the broader market in mild oscillation. At the close, the Hang Seng Index fell 0.71% to 25,635.23 points; the Hang Seng Tech Index fell 0.30% to 5,483.01 points; the H-Shares Index fell 0.26% to 8,891.71 points.
From industry performance, paper, crypto-related, and new energy vehicles strengthened collectively, while gold, lithium batteries, and power stocks generally pulled back.
Japanese stock market:The Nikkei Index fell 0.44% to 50,526.92 points.
Non-ferrous metals, wholesale, steel and others rose, while rubber products, mining, pharmaceuticals and others declined.
Korean stock market:The KOSPI rose 2.20% to 4,220.56 points.
Aerospace, non-ferrous metals, two-way, electrical equipment and others rose, while advertising, electronics, life insurance and others declined.
Australian stock market:The S&P/ASX 200 fell 0.42% to 8,725.700 points. Semiconductors, consumer packaging, restaurants and others rose, while aerospace, apparel, alcohol and others declined.
Singapore stock market:The FTSE Singapore Straits Times Index STI fell 0.05% to 4,633.64 points. Education, auto & parts, personalized services and others rose, while forestry products, apparel, industrial distribution and others declined.
Malaysian stock market:The FTSE Malaysia KLCI rose 0.23% to 1,680.99 points. Real estate, utilities, construction and others rose, while real estate, healthcare, closed-end funds and others declined.
Key Events
Global Sixth! Korea’s Annual Exports First Exceed $700 Billion in History
Preliminary data released December 29 by Korea’s Ministry of Trade, Industry and Energy and Customs Service shows that as of 1:03 p.m. that day, Korea’s full-year exports surpassed $700 billion.
This is the first time Korea’s annual exports have crossed $700 billion. Korea first exceeded $100 billion in 1995, $200 billion in 2004, $500 billion in 2011, and $600 billion in 2018.
This milestone makes Korea the sixth country globally — after the U.S., Germany, China, Japan, and the Netherlands — to achieve annual exports over $700 billion.
BOJ Hike Path Far from Over! Official: Real Rates Global Bottom – Calls for Hikes Every Few Months
Early Monday, BOJ December meeting minutes showed some monetary policy committee members view Japan’s real rates as still very low. They not only pushed the December hike but support further hikes next year. The yen strengthened early Monday on this.
Per minutes from the two-day meeting ending December 19, one of nine members said: “Japan’s real policy rate is currently at the global lowest level.” “It is appropriate for the Bank to adjust the degree of monetary accommodation.”
The unnamed member added the BOJ policy rate is far from neutral — “quite a distance away.”
Institutional Views
Fidelity International: Southeast Asia Stocks See Foreign Capital Return – 2026 as Alternative Allocation to Crowded AI Track
Fidelity International’s latest view on December 29 notes Southeast Asian emerging markets attracted net foreign inflows of $337 million in December — on track for the highest since September 2024, led by Indonesia and Thailand.
Strategists say investors are turning to ASEAN markets as a preferred diversification option to reduce reliance on U.S. stocks and crowded AI trades, bolstered by the region’s low valuations — positioning it for continued benefits in 2026.
The firm emphasizes diverse growth drivers across ASEAN countries: Vietnam benefits from supply chain shifts, Indonesia from domestic demand and commodities. Recommend selective high-dividend and domestic-oriented names.
Morgan Stanley: Japan Stocks Face Short-Term Heightened Volatility, Medium- to Long-Term Still Bullish on Corporate Governance Improvements and Yen Appreciation
Morgan Stanley commented December 28 on the BOJ’s December hike (rates to 0.75%), viewing short-term Nikkei 225 valuation pullback from the hike but intact medium- to long-term core logic.
The bank notes ongoing trends in Japanese corporate buybacks, dividends, and ROE improvements, combined with expected Fed cuts supporting further yen appreciation — enhancing Japan stocks’ appeal to global capital. Recommend focus on machinery, precision manufacturing, and high-governance domestic consumer stocks; avoid high-debt and rate-sensitive real estate/financial names.