Investment 10/7/2023

The Hang Seng Index opened 97 points lower and reported at 18,435. Afterwards, the decline in the market continued to expand. It once fell as low as 18,279 and plummeted 254 points, hitting a one-month low. The HSI once rose 4 points and reached a high of 18,537. It continued to pull back, and finally closed at 18,365 throughout the day, down 167 points. The HS Tech index closed at 3,901, down 47 points. The turnover of the market was HK$ 99.4 billion . 

The HSI fell 551 points in a week; the HS Tech index fell 10 points. 

The HSI fell with a big black candle last week, with a high of 19,449 and a low of 18279. In the short term, it is expected to test the low of 18,044 at the end of May again. The technical indicators of the trend are weak, and the 50-DMA (19,366) fell below the 250-DMA (19,424), showing a death cross signal. FSI rises from the low of 14,597 in October last year to the high of 22,700 in January this year, if it is adjusted by fibo 0.618 times, it can be seen as 17,692. If there is a short-term rebound, last Thursday's falling gap (18,973 to 19,095) is expected to have a major resistance. 

The decline in Hong Kong stocks was mainly related to the weakening of the RMB. The HSI component stocks fell more and rose less, and many mainland banking stocks suffered heavy losses. Although there are rumors that the Politburo meeting in July may introduce favorable measures, the market remains on the sidelines. Mainland local government bond risks and financing pressure have plagued the prospects of Hong Kong stocks, making the HSI lack of upward momentum for the time being. The amount of consumer coupons to be distributed in mid-July may not be able to significantly stimulate local consumption, so I have reservations about the consumer goods sector. With U.S. Treasury Secretary Yellen's visit to China, the trip is mostly about economic issues, and China's restrictions on the export of semiconductor raw materials may not benefit the sanctioned Chinese stocks in the short term. In the next three months or so, we are optimistic about China-funded telecommunications, electric power, and infrastructure sectors mainly supported by domestic demand. 

The U.S. private sector increased by 497,000 jobs in June, the largest increase since February last year, which was higher than expected. Global bond yields have risen sharply. Among them, the U.S. 10-year bond yield has risen by more than 4%. The market is concerned about the Fed’s increase in the second half of the year. US stocks fell overnight due to the magnitude of interest rates.

European stock markets closed individually. British stocks fell 0.32%, while French and German stocks rose 0.42% and 0.48% respectively. 

The growth of non-agricultural jobs in the United States slowed to 209,000 in June, less than the 230,000 expected by the market, but wage growth remained strong. The Fed resumed raising interest rates this month. After opening 85 points lower, the Dow fluctuated, rising 114 points at one point, reaching a market high of 34,036, but fell from a high level, and extended its decline to 205 points near the close, reaching a low of 33,716; Up 0.92%. 

The US stock market closed: the Dow still fell 187 points to 33,734, falling for 3 days in a row; the S&P fell 12 points to 4,398; the Nasdaq dropped 18 points to 13,660. Cumulatively for the whole week, the Dow fell 1.96%, the worst week since March; the S&P fell 1.16%, and the Nasdaq fell 0.92%.