Alibaba joins Southbound Stock Connect amid mixed Asian markets

Asian equities experienced a decline amid light trading volumes, with notable exceptions in India, Singapore, Thailand, and the Philippines, which saw gains despite the strengthening US dollar against regional currencies. Alibaba's addition to the Southbound Stock Connect occurred after the Hong Kong market closed, aligning with previous expectations. This move is significant as it allows Mainland investors to hold a portion of Alibaba's shares, similar to Tencent, which has 10% of its shares held by these investors. The market's performance was influenced by a decline in the producer price index (PPI) for August, which fell by 1.8%, missing the anticipated 1.5% decline. This drop was attributed to falling commodity prices, while domestic consumption and consumer confidence remained weak. Despite households having available funds, spending has not increased, indicating a cautious approach among consumers. In Hong Kong, major stocks like Tencent and Alibaba saw declines, with Tencent down 0.59% and Alibaba down 1.88%. Notably, Tencent repurchased shares, and Alibaba also engaged in buybacks, reflecting efforts to bolster investor confidence. Other stocks, such as Meituan and CNOOC, also faced losses, while NIO experienced a significant jump of 13.05% after reporting a smaller-than-expected loss. Overall, the Southbound Stock Connect saw high volumes, with Mainland investors purchasing a net $747 million in Hong Kong-listed stocks. The broader market trends indicated a negative performance across various sectors, including energy and materials, as investors reacted to the prevailing economic conditions and market sentiment.