APAC Market Wrap - May 8

China: Major indices closed mixed, with the Shanghai Composite finishing flat (0.00%), while the Shenzhen Component fell 0.50% and the ChiNext Index dropped 0.96%.

 

Aerospace, reducers, and defense sectors saw active trading, whereas fluoro-chemicals, energy metals, and electronic chemicals underperformed.

 

Hong Kong: Markets faced broad pressure as all three major indices retreated. The Hang Seng Index fell 0.87% to 26,393.71, the Hang Seng Tech Index dipped 0.36% to 5,102.79, and the H-Share Index slid 0.34% to 8,889.07.

 

Large-cap tech stocks mostly trended lower, with semiconductors and lithium leadng the decliners, while mainland property developers bucked the trend to move higher.

 

Japan: The Nikkei 225 edged down 0.19% to 62,713.65. Metal products, services, and other manufacturing sectors posted gains, while banking, securities, and marine transportation sectors closed lower.

 

South Korea: The KOSPI rose 0.24% to 7,508.26, led by Hyundai Motor. However, heavyweight chipmakers Samsung Electronics and SK Hynix saw some weakness.

 

Australia: The S&P/ASX 200 fell 1.51% to 8,744.40. While select energy stocks traded higher, banks and non-energy minerals led the losses.

 

Singapore: The Straits Times Index (STI) fell 0.30% to 4,927.38. Industrial and real estate sectors showed pockets of strength, while financials and technology faced slight pullbacks.

 

Malaysia: The FTSE Bursa Malaysia KLCI declined 0.45% to 1,750.95. Technology and utilities remained active, while banking and plantation sectors trended lower.

Key Events

Goldman Sachs: KOSPI Rally Far From Over, Targets 9,000 Points

 

Fueled by insatiable demand for AI chips, South Korean equities have delivered one of the world's most impressive rallies this year, recently overtaking Canada as the world's seventh-largest stock market.

 

Goldman Sachs suggests the momentum is just beginning, naming South Korea its top pick in Asia with an "Overweight" rating. The bank raised its 12-month KOSPI target to 9,000—representing a roughly 20% upside from current levels.

 

Toyota Q1 Operating Profit Nearly Halves Amid Tariff Pressures

 

Toyota, the world’s top-selling automaker, reported a 49% year-over-year decline in operating profit for its fourth fiscal quarter ending in March, significantly missing analyst estimates.

 

While revenue held steady at 12.6 trillion yen, operating profit slumped to 569.4 billion yen, far below the projected 813.28 billion yen. For the full fiscal year, net profit fell 19% to 3.8 trillion yen, with the company attributing approximately 1.4 trillion yen in losses to U.S. tariffs.

 

Sony Forecasts Sluggish Console Sales as Memory Costs Climb

 

Sony Group warned that rising memory costs could weigh on its gaming division’s revenue through the 2026 fiscal year.

 

Reporting its fiscal 2025 results on Friday, Sony posted annual revenue of 12.47 trillion yen (up 3.7%), though operating profit of 1.45 trillion yen missed the 1.56 trillion yen consensus. Net profit attributable to shareholders slipped 3.4% to 1.03 trillion yen, reflecting the pressure of increasing component costs.

 

Global Memory Giants Surge: Micron and SK Hynix Top $700B; Samsung Hits $1T

 

The historic rally in memory stocks continues. Micron Technology shares have surged 124% year-to-date and nearly 700% over the past 12 months, securing a spot among the top 10 U.S. tech companies by market cap.

 

The company recently began shipping its highest-capacity commercial SSDs, which offer superior storage density and lower power consumption than traditional HDDs.

Institutional Perspectives

Wells Fargo on Labor Markets: Economists noted that the U.S. labor market remains in a state of low hiring and low turnover.

 

With labor supply now the primary constraint on growth, the bank expects a significant slowdown in payroll additions for April, forecasting a total increase of just 70,000.

 

JPMorgan on Corporate Leverage: Analysts observed that U.S. corporates—particularly hyperscale cloud providers—are continuing to add debt despite strong earnings to maintain growth prospects.

 

However, the bank notes that credit spreads are likely to remain tight as earnings growth continues to adequately service the expanding debt levels.