Tencent's stock crashes 16% in minutes after Beijing released draft guidelines aimed at curbing incentives that could lead to excessive gaming and spending
Tencent is China's largest public company and the drop erased ~$55 billion of market cap. This also marks the biggest one-day drop for the company since 2008. Note that NetEase sank by as much as 28% to HK$117.30, breaking briefly below a key technical support offered by a February low at around HK$120.70. In mid-afternoon trade, NetEase shares pared losses to trade down about 20% at HK$129. Source: The Kobeissi Letter, CNBC
Chinese stocks made up 24.7% of the MSCI Emerging Markets index by capitalization, down from 40% three years ago
Meanwhile, India's weight has doubled... Source: Gavekal
Japan | BOJ Avoids Rate Hike Signal as It Stands Pat, Driving Yen Lower – Bloomberg
As expected, no change from the BoJ this morning on rates or the YCC. The vote was 9-0, in favor of no change. There wasn’t even a hint of change to the policy statement. No change in language around wages and inflation. The Japanese Yen weakened considerably on the initial press release. Nikkei 225 is up +1.5% Source: Ayesha Tariq, Bloomberg
BREAKING: Chinese Equities
Chinese Stocks continue to nosedive and have fallen to their lowest prices in 5 years. Source: Barchart
BREAKING: China's central bank injects RECORD monthly amount into money markets
Source: Bloomberg
China reports fastest industrial expansion in nearly 2 years; retail sales growth misses estimates
China's industrial production advanced by 6.6% year-on-year in November 2023, following a 4.6% gain in the previous month and beating market forecasts of 5.6%. It was the fastest pace of growth since February 2022. Retail sales climbed 10.1% in November from a year ago, the fastest pace of growth since May — though analysts had expected a 12.5% spike following a low base in 2022. Retail sales rose 7.6% in October. Fixed asset investment in urban areas cumulatively grew 2.9% in the first 11 months of the year, compared to expectations for 3% growth. China’s urban unemployment rate stayed at 5% in November. Source: Trading Economics, CNBC
China is the only country experiencing deflation
CPI is down 4.7% since 2020 while every other country has experience inflation – some experiencing the highest in decades. Source: Genevieve Roch-Decter, CFA, Bloomberg, Macrobond
Each time inflation in China turned negative the global economy was in a recession: 2001, 2008-09, 2020... Is this time different?
Source: Jeffrey Kleintop, Bloomberg
