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It's Super Thursday for Earnings and Central Banks: Taking Stock

It's Super Thursday for Earnings and Central Banks: Taking Stock

(Bloomberg) -- Thursday is going to be a long day for market watchers in Asia.

Traders woke up to Federal Reserve Chairman Jerome Powell’s comments that the central bank would keep interest rates on hold for “some time” as global risks weigh on the U.S. economy and inflation remains muted.

And most investors will likely have to stay at their desks longer: Led by Tencent Holdings Ltd., seven large-cap companies in Hong Kong accounting for 24 percent of the Hang Seng Index are set to report results Thursday, most of which are expected after the market close. It’s the most intense day for earnings in Hong Kong since October 2017, with the benchmark gauge on the brink of a bull market and traders looking for any signs the good times will continue to roll.

Tencent, the biggest component of Asia’s benchmark index, comes into its latest report on a wave of investor optimism. The stock has rallied more than 3 percent in the past week, the best run-up ahead of earnings since its 2017 first-quarter release, according to data compiled by Bloomberg. The technology giant has already bounced back almost 50 percent from an October low.

Other notable companies reporting Thursday include PetroChina Co., Cnooc Ltd. and CK Hutchison Holdings Ltd. China Mobile Ltd. and Geely Automobile Holdings Ltd. already announced -- a net income beat for the former and meet for the latter.

But that’s not all. More central banks are also vying for investors’ attention. Rate decisions are coming for Indonesia, Taiwan and the Philippines, all ahead of the Bank of England’s own interest rate announcement at noon in London.

Phew.

While U.S. stocks closed lower after the Fed update, Asian equities ticked higher, with emerging markets getting a lift on the central bank’s more dovish stance. The MSCI Asia Pacific ex-Japan Index -- Japan is closed for a holiday, and so is India -- advanced as much as 0.7 percent, heading for its highest close since August. Shares in the Philippines, China and Thailand posted the biggest gains.

It's Super Thursday for Earnings and Central Banks: Taking Stock

For at least one day, the ongoing trade talks between the U.S. and China don’t appear to be at the top of the priority list for investors. In fact, they’re shrugging off the news that Donald Trump said he plans to keep tariffs on China until he’s sure Beijing is complying with any trade deal, potentially throwing another roadblock on the path toward a signed deal.

“Many would say this is a fair point, but for China it clearly is not, and likely explains the drawn-out nature of the negotiations,” said Jeffrey Halley, senior market strategist with Oanda Corp. in Singapore.

Just add it to the list for another day.

Stock-Market Summary

  • MSCI Asia Pacific ex-Japan Index up 0.4%
  • Hong Kong’s Hang Seng Index up 0.2%; Hang Seng China Enterprises up 0.5%; Shanghai Composite up 0.6%; CSI 300 up 0.2%
  • Taiwan’s Taiex index up 0.4%
  • South Korea’s Kospi index up 0.2%; Kospi 200 up 0.7%
  • Australia’s S&P/ASX 200 down 0.3%; New Zealand’s S&P/NZX 50 up 0.3%
  • India’s SGX Nifty 50 futures up 0.7%
  • Singapore’s Straits Times Index little changed; Malaysia’s KLCI down 1.1%; Philippine Stock Exchange Index up 0.9%; Jakarta Composite up 0.2%; Thailand’s SET up 0.7%; Vietnam’s VN Index little changed
  • S&P 500 e-mini futures little changed after index closed down 0.3% in last session

To contact the reporter on this story: Eric Lam in Hong Kong at elam87@bloomberg.net

To contact the editors responsible for this story: Christopher Anstey at canstey@bloomberg.net, Cecile Vannucci, Joanna Ossinger

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