Investment 6/12/2023

Hong Kong stocks opened 39 points lower and then fell further. The Hang Seng Index fell as much as 417 points in late trading, reaching a new low of 16,228 points this year. It closed at 16,327 points, down 318 points or 1.91%, falling for three consecutive days. The technology index closed at 3,682 points, down 77 points or 2.05%. The main board's total trading volume for the whole day was HK$118 billion. 

If, as expected, the Hang Seng Index is close to fully covering the rising gap left in November last year (16,138 to 16,829), it is expected that there will be a short-term rebound, and it will be better to hold on to 16,800 points thereafter, otherwise the selling pressure will be difficult to subside. The Hong Kong stock market currently faces strong resistance, and it is difficult to surpass the 10-DMA (17,183). It is expected that after the Hang Seng Index repeatedly consolidates, the bottom-hunting pattern will continue, and may once again test last year's low of 14,597 points. 

Although the momentum of US stocks in December is still good, the impact of US stock performance on Hong Kong stocks has long been decoupled; Hong Kong stocks are still affected by the performance of mainland economic data. Even if the index rises, trading volume is still low, reflecting low market capital investment. Moody's announced on December 5 that it had lowered China's rating outlook to negative. Moody's said there is growing evidence that the Chinese government and public sector will need to provide more financial support to local governments and state-owned enterprises, which will bring downside risks to the Chinese economy. Moody's also maintained China's A1 rating unchanged and forecast China's GDP growth rate in 2024 and 2025 at 4.0%.

 European stock markets had mixed trends, with British stocks falling 0.31%, French and German stocks rising 0.74% and 0.78% respectively. 

The weakening U.S. employment data intensified the market's concerns about the economy. U.S. stocks performed individually on Tuesday. The Dow Jones Industrial Average opened 68 points lower and then immediately fell. The decline once expanded to 193 points and hit a low of 36,010 points. The decline narrowed at the close; the S&P 500 index once fell. 0.4%; the Nasdaq, which is dominated by technology stocks, has repeatedly made gains. Apple's stock price has risen by more than 2%, and its market value has exceeded the US$3 trillion mark. 

At the close of the U.S. market, the Dow fell 79 points, or 0.22%, to 36,124 points; the S&P Index retreated 2 points, or 0.06%, to 4,567 points; the Nasdaq's gain narrowed to 43 points, or 0.31%, to 14,229 points.