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Global Market Quick Take: Asia – February 22, 2024

Macro 6 minutes to read
APAC Strategy Team

Summary:  Nvidia’s earnings beat boosted sentiment and eased concerns over stretched valuations, providing room for the AI theme to continue to drive markets. US equity futures jumped higher and Nikkei 225 gapped up to open more than 1% higher. China and HK stocks also continued the rally on Wednesday with policy measures seen expanding. FOMC minutes did not add any extra hawkish fears, and dollar traded sideways but JPY weakness has become more pronounced on the crosses.

The Saxo Quick Take is a short, distilled opinion on financial markets with references to key news and events. 


US Equities: While the S&P 500 edged up by 0.1%, the tech-heavy Nasdaq 100 slid 0.4% on Wednesday before Nvidia’s results. After the market closed, Nvidia reported Q4 revenue of $22.1 billion, marking a 265% jump from a year ago—significantly surpassing the Street’s expectation of $20.4 billion. Adjusted net income on a comparable basis exceeded expectations at $12.8 billion, or $5.16 a share, sharply higher than the $2.2 billion, or 88 cents a share, reported in the last year's quarter and ahead of the $11.4 billion, or $4.60 a share, projected by analysts.

The management guided for current-quarter revenue of $24 billion, surpassing analysts’ forecast of $21.9 billion, driven by continuously strong generative AI demand for Nvidia’s advanced microchips. CEO Jensen Huang noted that “accelerated computing and generative AI have hit the tipping point” and “demand is surging worldwide across companies, industries, and nations.” Both the guidance and the use of the term ‘tipping point’ strongly indicate the company’s confidence in the growth of generative AI. Nonetheless, as Peter Garnry Saxo’s Head of Equity Strategy, remarks, it will be increasingly difficult for Nvidia to exceed expectations in the coming quarters.

Nvidia’s share price surged nearly 8% in extended-hour trading. Meanwhile, the Nasdaq 100 eMini futures rose nearly 1%, the S&P 500 eMini futures gained around 0.6%, and the Nikkei 225 advanced more than 1% in early Asian hours on Thursday.

Fixed income: A $16 billion 20-year T-bond auction encountered subdued investor demand, leaving a larger-than-average amount with the primary dealers. The lackluster auction result prompted selling in Treasuries across the curve, resulting in higher yields. The 10-year T-note yield rose by 4 basis points to 4.32%.

China/HK Equities: Stocks in Hong Kong and mainland bourses climbed as investors processed the policy signals aimed at boosting housing demand. This was driven by the large 25-bp cut to the 5-year loan prime rate and the infusion of new loans into property projects on the 'white list,' reaching RMB 30 billion. Additionally, news reports indicating that Chinese regulators imposed more restrictions on some domestic institutions from selling stocks underscored the intensity of the Chinese authorities' measures to stabilize the stock market. The CSI 300 gained 1.4%, and The Hang Seng Index rose 1.6%. Longfor surged 9.5%, while China Resources Land and China Overseas Land each added more than 4%.

Hang Seng Bank jumped 9.1% after reporting a 58.5% increase in net income, attributed to a 26% rise in net interest income and a 19% decline in loan loss provisions for the year 2023. This was accompanied by a 33% reduction in China property credit exposure. Meanwhile, HSBC slid 3.8% after reporting Q4 results that missed analyst estimates and a USD 3 billion charge on its 19% stake in China’s Bank of Communications.

FX: Dollar traded sideways with lack of that extra hawkish bias in FOMC minutes but sustained exceptionalism of the US economy providing support. Higher Treasury yields following the 20-year auction did not move the dollar, but yen weakness extended further. USDJPY rose back to 150.20+ levels, and other yen pairs were also in focus. EURJPY reached fresh highs since November at 162.74 while NZDJPY at 93 is the highest since 2015. NZD momentum continued but NZDUSD hitting a resistance at 0.62 with RBNZ meeting on the radar next week – we expect a hawkish bias which could drive further gains for NZD. AUDNZD is back to test 1.06 handle that was rejected earlier this month. CHF, however, seems to have reversed some of the weakness for now with USDCHF back below 0.88 and EURCHF testing 0.95.

Commodities: Crude oil prices were firmer but focus is shifting to whether a new hostage deal could be signed in the Middle East. Iron ore extended recent losses amid doubts over consumption in China despite steps from Beijing to restore confidence. However, focus is shifting to metals like Aluminum and Nickel after President Biden said that the US plans to unveil a major sanctions package against Moscow on Friday. Gold remained stable despite the run higher in yields again.


  • The minutes of the FOMC minutes continued to highlight that most policymakers were more concerned about easing too soon rather than maintaining an overly restrictive stance for too long. Wall Street Journal's Nick Timiraos said that the minutes show unease over premature rate cuts. However, that pushback wasn’t any more than what we have heard from policymakers in recent weeks and did not worry markets.
  • BOE’s Dhingra, the only voter who has been voting to cut rates, said that UK consumption remains below pre-pandemic in contrast to US and eurozone, and that overtightening could mean hard landing. In contrast to what the Fed minutes hinted, she said that for the BOE, evidence to err on the side of overtightening is not compelling.

Macro events: EZ Final HICP (Jan), ECB Minutes (Jan) EZ, UK & US Flash PMIs (Jan), Canada Retail Sales (Dec)

Earnings: Lenovo, Genting Singapore, Fortesque, Zurich Insurance, Nestle, AXA, Booking, Copart, Intuit, MercadoLibre, EOG Resources, NU Holdings, Mercedes-Benz, Iberdrola, Pioneer Natural Resources, Danone, Anglo American, Wolters Kluwer, Rolls-Royce.

In the news:

  • Nvidia Surges After AI Boom Shows No Signs of Letting Up (Bloomberg)
  • China Tightens Grip on Stocks With Net Sale Ban at Open, Close (Bloomberg)
  • US targets China's top chipmaking plant after Huawei Mate 60 Pro (Reuters)
  • HSBC's shares slide as record profit marred by $3 billion China hit (Reuters)
  • Hong Kong developers urge government to remove all property cooling measures (SCMP)
  • Singapore Airlines shares drop following earnings miss and analysts' downgrades (The Edge)
  • Qantas sees 13 per cent profit decline as airfares start to normalise (The Sydney Morning Herald)


For all macro, earnings, and dividend events check Saxo’s calendar.

For a global look at markets – go to Inspiration


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