The Hong Kong-listed shares of China’s CATL, the world’s largest battery maker, dropped over 8 percent on Thursday as investors were attempting to hedge profits, after the lock-in profits of a six-month sales restriction on approximately 77.5 million shares owned by early shareholders.
According to the prospectus of the company, the 23 cornerstone investors are Sinopec HK, Kuwait Investment Authority, and UBS Asset Management.
The company’s filing indicated that CATL’s IPO in May surged HK$35.7 billion ($4.6 billion), which was reportedly the largest offering of the year in the entire world, as investors hoped the company would be able to ride the electric vehicle boom. The CATL stocks at the Shenzhen stock exchange were also falling by 2.59 percent.
The Hang Seng Index of Hong Kong increased by 0.14 percent, and the mainland CSI 300 up by 0.32 percent.
Other markets in the region followed suit, as chip shares surged, enhanced by bigger-than-anticipated earnings and optimistic guidance seemingly triggered by Nvidia that strengthened faith in the global AI trade.
The chip giant’s shares increased over 4 percent in extended trading, following its fiscal third-quarter earnings, which surpassed earnings and revenue forecasts.
The AI chip sensation also presented an enhanced-than-anticipated fourth-quarter sales projection, with CEO Jensen Huang indicating that its current-generation Blackwell chips are “off the charts.”
However, the benchmark Nikkei 225 index in Japan soared by 3.7 percent at the beginning of the trade, and the Topix rose by 1.67 percent.
Chip-related stocks surged on the index as investors encouraged Nvidia’s quarterly report, with tech conglomerate SoftBank soaring to 8 percent, semiconductor equipment maker Tokyo Electron rising 7 percent, Lasertec adding 5.6 percent, and chipmaker Renesas Electronics trading up 4.8 percent.
Meanwhile, the yield on 30-year Japanese government bonds climbed almost 3 basis points to record a high of 3.375 percent.
The 20-year government bond increased above 3 basis points to 2.853 percent, the highest since 1999, and the 10-year bond yield advanced 3.6 basis points to 1.799 percent, the highest since 2008.
The Kospi index of South Korea progressed 2.63 percent, and the small-cap index Kosdaq improved 1.75 percent. This positive investor mood also spread to South Korea, where index heavyweights such as memory chip producers SK Hynix and Samsung Electronics gained over 6 percent and 3.3 percent, respectively; therefore, Australia’s ASX/S&P 200 increased by 1 percent.
The Taiex of Taiwan increased by up to 2.6 percent, the stock of Nvidia chip maker TSMC on the index soared more than 4 percent, and Hon Hai Precision Industry, also referred to as Foxconn, which is also a supplier of Nvidia, rose by 2.84 percent. The Nifty 50 in India increased 0.18 percent at the open, and its index, Sensex, increased 0.19 percent.
The U.S. equity futures rose at the start of the Asian hours after Nvidia issued optimistic forecasts, which probably boosted investor confidence in the AI trade, following recent sessions that were indicative of the fear of high prices, debt issuance, and potential chip depreciation.
TradeStation’s global Head of Market Strategy, David Russell, said, “Nvidia’s numbers remain extremely strong now, but there are inevitably questions whether Huang’s company has already reached its high-water mark in terms of growth and market share.”
The S&P 500 gained 0.38 percent overnight to end at 6,642.16, surpassing a four-day losing streak, but the Nasdaq Composite advanced 0.59 percent to settle at 22,564.23. The Dow Jones Industrial Average reached 47 points, or 0.1 percent, to finish at 46,138.77.
