APAC Market Wrap — Apr 14

China Equity Markets: Major indices closed higher across the board, with the Shanghai Composite gaining 0.95%, the Shenzhen Component rising 1.61%, and the ChiNext Index surging 2.36%.

 

Computing hardware remained a dominant theme, led by a breakout in PCB concepts and a rally in liquid-cooled server stocks.

 

Hong Kong Equity Markets: Improving market sentiment propelled Hong Kong’s benchmark indices higher. The Hang Seng Tech Index outperformed, briefly testing the 4,900 level before paring gains.

 

At the close, the HSI rose 0.82% to 25,872.32, while the Tech Index added 0.62%. Real estate, commercial aerospace, and new consumption sectors saw gains, contrasting with weakness in lithium batteries and oilfield services.

 

Japan: The Nikkei 225 surged 2.43% to 57,877.39. Non-ferrous metals and electrical equipment led small gains, while mining and marine products saw heavy selling.

 

South Korea: The KOSPI rallied 2.74% to 5,967.75, driven by a broad advance in venture capital, computing, and brokerage sectors.

 

Australia: The S&P/ASX 200 edged up 0.50% to 8,926.2. Semiconductors and software led the upside, while waste management and agriculture trailed.

 

Southeast Asia: Singapore’s STI gained 0.47% to 5,007.57. In Malaysia, the KLCI rose 0.45% to 1,688.12, with tech and property offsetting losses in energy and media.

Key Events

Shift in Rhetoric? Trump Camp Adopts "Wait-and-See" Stance on Rates

 

Treasury Secretary Scott Bessent stated Monday that the Fed should remain in a "wait-and-see" mode before considering rate cuts during the ongoing Iran conflict. This marks a pivot from the Trump administration's previous demands for immediate cuts, suggesting the White House is temporarily aligning with the Fed as war-driven oil prices stoke inflation risks.

 

Peak Energy? Morgan Stanley CIO Predicts Sharp Decline by Year-End

 

Despite the recent surge in energy prices due to the Strait of Hormuz conflict, Morgan Stanley’s Michael Wilson suggests the sector has topped out. The bank noted that energy stocks’ relative performance has begun to roll over, signaling that oil and gas prices could see a substantial decline between now and December.

 

Saudi Arabia Pressures U.S. to Lift Hormuz Blockade Over Red Sea Fears

 

Saudi officials are reportedly urging the U.S. to abandon its blockade of the Strait of Hormuz and return to negotiations. Riyadh fears the naval standoff will provoke Iran into retaliating by closing the Bab el-Mandeb Strait, effectively paralyzing Saudi crude exports through the Red Sea.

Institutional Views

CICC: Global Stagflation Narrative Likely Overstated

 

CICC analysts argue that while supply shocks are real, the stagflation narrative is exaggerated. If the Strait of Hormuz reopens, geopolitical risks will likely drive a "K-shaped" divergence—favoring investment over consumption—rather than a wage-price spiral, as AI continues to offset labor market pressures.

 

Investinglive: Gold Shifts Bullish; Islamabad Talks are the Next Catalyst

 

Short-term sentiment on gold has turned bullish as traders reprice hawkish expectations following the two-week ceasefire announcement. However, with hostilities between the U.S. and Iran not yet formally concluded, any breakdown in the Islamabad talks could swiftly reverse current market sentiment.

 

Capital Economics: Brent-WTI Spread to Normalize if Ceasefire Holds

 

Economist Hamad Hussain expects the Brent-WTI spread to return to its traditional premium once Middle East supply fears subside. The current inversion reflects extreme short-term tightness in the oil market, which should ease in the coming months if the diplomatic framework remains intact.