Investment 18/9/2023

The People's Bank of China's reserve requirement ratio cut and the mainland's latest economic data released were better than expected, which provided a short-lived stimulus to the Hong Kong stock market. The HSI rose 324 points in the earliest period, reaching a high of 18,372 points; the increase narrowed in the afternoon and closed at 18,182 points, up 134 points. The HS technology index closed at 4,077 points, up 18 points. The main board's total trading volume for the whole day was HK$118 billion. 

The HSI went sideways last week, falling 19 points or 0.1% for the whole week; the HS Tech index fell 13 points or 0.31%. 

The People's Bank of China lowered the deposit reserve ratio, but the market is still worried that domestic property sales will affect other economic sectors. Although the "recognize houses but not loan" measure has achieved good results in the first week, it cannot be regarded as a turning point for the property market. On the external front, the European Central Bank's interest rate hike did not lead to a correction in the U.S. dollar. The strong U.S. dollar depreciated the RMB and other currencies, dragging down the rebound of Hong Kong stocks. Although the HSI broke through the 20-DMA (18,175) on Friday, it was restricted by the 10-DMA (18,270). The next resistance level is the downward trajectory formed since August (18,500), and the falling gap on August 14 (18,792 to 19,049). 

Driven by the performance of luxury goods stocks, European stock markets rose, with British, French and German stock markets rising by 0.5%, 0.96% and 0.56% respectively. 

Although U.S. inflation expectations have fallen sharply, U.S. stocks retreated on Friday, dragged down by pressure on large technology stocks. After the Dow opened slightly lower by 5 points, the decline expanded to as much as 334 points and as low as 34,572; the S&P 500 index fell 1.28%. The Nasdaq, which is dominated by technology stocks, once fell 1.74%. 

At the close of the U.S. stock market, the Dow still fell 288 points to 34,618; the S&P 54 dropped 54 points to 4,450; and the Nasdaq fell 217 points to 13,708. 

Friday is the "Quadruple witching day" for U.S. stocks, which is the settlement day for futures and options on indices and individual stocks. According to past records, market conditions are generally relatively volatile.