APAC Market Wrap - Feb 10

China Equities:

At the close, the Shanghai Composite edged up 0.13%, the Shenzhen Component gained 0.02%, and the ChiNext Index fell 0.37%.

 

Sector-wise, the media sector maintained its lead throughout the session, and the humanoid robot concept saw active trading. On the downside, the commercial aerospace sector retreated.

 

Hong Kong Equities:

The Hong Kong market continued its pattern of volatile consolidation today, with the three major indices all closing higher. At the close, the Hang Seng Index rose 0.58% to 27,183.15; the Tech Index gained 0.62% to 5,451.03; and the H-Share Index climbed 0.81% to 9,242.75.

 

In terms of market performance, AI applications, film and television, pharmaceuticals, and power equipment stocks showed strength, while education and catering names weakened.

 

Japan Equities: The Nikkei 225 surged 2.28% to 57,650.54. By sector, non-ferrous metals and real estate indices rose, while air transport and food sectors declined.

 

South Korea Equities: The KOSPI edged up 0.07% to 5,301.69. Department stores, airlines, and packaging materials saw significant gains, while utilities, telecommunications equipment, and office electronics trended lower.

 

Australia Equities: The S&P/ASX 200 dipped 0.03% to 8,767.40. Aerospace, industrial products, semiconductors, and interactive media services sectors rose, while education, biotechnology, and insurance declined.

 

Singapore Equities: The Straits Times Index (STI) rose 0.07% to 4,964.25.

 

Furniture, non-alcoholic beverages, and apparel industries rose, while interactive media, chemicals, and forestry products declined.

 

Malaysia Equities: The FTSE Bursa Malaysia KLCI fell 0.21% to 1,747.54.

 

Construction, telecommunications & media, and energy sectors rose, while utilities, healthcare, and consumer goods declined.

Key Events

FTSE Russell Joins MSCI in Delaying Indonesia Equity Review

 

Index provider FTSE Russell issued a statement on Monday (Feb 9) noting that, in light of concerns raised by rival MSCI regarding the investability of Indonesian equities, it has also decided to postpone its assessment of Indonesia.

 

MSCI and FTSE indices are widely used as benchmarks for investors and are tracked by trillions of dollars in passive funds globally, meaning their decisions significantly impact capital flows.

 

In its latest announcement, FTSE Russell did not change Indonesia's classification as a "Secondary Emerging Market" but raised concerns over the "difficulty in determining the degree of free float (free trading) of shares."

 

The company stated it would postpone the index review originally scheduled for March and provide another update prior to the May global review.

 

FTSE Russell also noted that, effective immediately, newly listed Indonesian stocks will not be included in its products, and there will be no updates for other additions, deletions, or weighting changes.

 

TSMC January Revenue Surpasses NT$400B for First Time Amid Sustained AI Boom

 

On Tuesday, TSMC, the world’s largest contract chipmaker, released its latest monthly revenue report. Data showed that TSMC’s January revenue grew nearly 20% month-on-month and approximately 40% year-on-year.

 

This indicates that global demand for artificial intelligence (AI) chips remains robust and the AI boom persists. Despite concerns over an AI bubble, global tech giants have not scaled back chip orders.

 

Specifically, TSMC’s January revenue stood at NT$401.26 billion (approx. 400 billion threshold.

 

HBM and AI Collaboration: SK Chairman Reportedly Meets Jensen Huang for "Fried Chicken Summit" in U.S.

 

SK Group Chairman Chey Tae-won has met with NVIDIA CEO Jensen Huang in the United States to discuss High Bandwidth Memory (HBM) supply and broader AI business cooperation, media outlets reported Monday, citing industry sources.

 

Sources said the meeting took place earlier this month at a fried chicken restaurant in California. Observers believe the two discussed supply plans for HBM4, the next-generation memory expected to be used in NVIDIA’s upcoming "Vera Rubin" AI accelerators.

 

SK Hynix, a subsidiary of SK Group, is a core supplier of HBM products to NVIDIA. The company has stated it is moving forward with the mass production of HBM4 according to the timeline agreed upon with customers.

Institutional Views:

1. Solomon: Gold Volatility is "Short-Term Noise"; Long-Term Bullish Confidence Remains High

 

Gold is experiencing sharp fluctuations, but market confidence in the fundamental drivers of its long-term upward trend remains very strong. Solomon Global Markets analyst Nick Cawley stated that current volatility is merely short-term noise. Gold is expected to break above $5,000 again in the coming weeks and retest decades-long highs of $5,600 in the second quarter.

 

Market washouts are healthy, especially after a strong rally, and the technical outlook remains positive. Tailwinds persist; while the dollar may be firm currently, rate cuts in the coming months will weaken the greenback or at least halt its further ascent. Rania Gule, senior market analyst at XS.com, noted that while gold may stay below $5,000 per ounce in the short term, a rise to $6,000 by year-end remains possible.

 

The market has not exhausted its bullish momentum. However, investors have become more discerning and cautious, suggesting that future gains may be accompanied by more corrections and driven more by fundamentals than pure momentum or speculation. The precious metals market is currently in a repositioning phase rather than a trend reversal.

 

2. Investinglive: Seasonal Tailwinds Nearing End; Gold Faces Volatility Test and Directional Choice

 

Investinglive analyst Adam Button noted that gold’s failure to hold the $5,000 mark this week was undoubtedly disappointing, though gold remains relatively stable compared to silver's performance. However, the intense volatility undeniably creates a sense of unease. For the coming week, the most favorable scenario for gold might be a decrease in volatility, even if that means prices drift slightly lower.

 

Unfortunately, gold’s volatility may not dissipate quickly; it tends to settle slowly after persisting for a period. In the coming days, the market will focus on potential catalysts from the situations in Iran and Ukraine, with the latest non-farm payrolls report due Wednesday.

 

For bulls, a retreat in the U.S. Dollar Index might provide some encouragement and serve as an upside catalyst. Notably, gold has remained resilient despite a series of margin hike shocks, reflecting underlying buying support. Ultimately, if gold prices can consolidate within the $4,500-$5,000 range for several weeks (or months), it would be a positive signal. The downside is that gold's traditional seasonal rally phase is now nearing its end.

 

3. Capital Economics: Oil Prices to Fall Toward $50/bbl by Late 2026

 

Oil prices rebounded more than 1% on Friday following a sharp sell-off the previous day but remain on track for their first weekly decline in nearly two months as supply concerns eased and investors focused on the outcome of U.S.-Iran talks later that day. Brent crude futures rose as much as 1.2% to $68.33 per barrel.

 

A lack of consensus on the agenda for the meeting between Iran and the U.S. in Oman has kept investors wary of geopolitical risks. However, Capital Economics pointed out that geopolitical concerns will eventually give way to weak fundamentals. Kazakhstan's oil production is expected to recover following severe disruptions in January. This will help drive oil prices back toward $50 per barrel by the end of 2026.

 

4. BNP Paribas: BoJ Rate Hike Pace May Be Slightly Faster Than Previously Anticipated

 

Economists at BNP Paribas stated that given Prime Minister Sanae Takaichi’s expansionary fiscal policies could further drive inflation, the Bank of Japan (BoJ) is expected to raise interest rates at a slightly faster pace than previously expected. Analysts anticipate the BoJ will hike rates in April, followed by continued tightening every four to five months until the policy rate reaches 2%.

 

The report noted: "Depending on future exchange rate movements, the possibility of the next rate hike being pulled forward to March cannot be ruled out." Japanese officials have previously warned that the government stands ready to take action against excessive yen volatility.