Investment 6/2/2024

The Hong Kong stock market opened 196 points lower and then struggled. The Hang Seng Index fell by nearly 200 points at most, hitting a low of 15,336 points and then rising briefly. It closed at 15,510 points, down 23 points or 0.15%. The Technology Index closed at 3,038 points, down 5 points or 0.17%. The main board's turnover for the whole day was HK$94.7 billion.

 The strong employment data in the United States last month continued to cool expectations of interest rate cuts, but at the same time strengthened the market's confidence in the economic prospects. Last Friday (2nd), the Dow Jones Industrial Average and the S&P 500 Index both reached their peaks. However, the recent trend of the mainland stock market has been volatile, and the Hong Kong stock market has also followed suit. It is believed that only when there is significant capital inflow can the stock markets of the two places be expected to change their weakness. In fact, the Lunar New Year is approaching, which may limit investors’ willingness to enter the market. The Hang Seng Index has certain support between 14,800 and 15,000 points, and there is also a chance to challenge the 20-DMA (15,757) again in the short term. However, further breakthroughs will depend on A-share performance.

 The People's Bank of China lowered the deposit reserve ratio by 0.5 percentage points starting from Monday (5th), releasing about 1 trillion RMB in long-term funds and increasing the funds that banks can use freely, which is said to help boost market sentiment. However, the three major A-share indexes continued to fall after the opening on Monday, with more than 1,000 shares in the two cities falling below their limit at one point. The Shanghai Composite Index once fell 95 points, or 3.48%, to a low of 2,635 points, which is not far from the previous low of 2,440 in January 2019. Afterwards, some people took advantage of the dip, and the market managed to rise to 2,739 points. The market weakened again, closing at 2,702 points, down 27 points or 1.02%, with a turnover of 424.8 billion. 

European stock markets were soft, with British, French and German stocks falling 0.04%, 0.03% and 0.08% respectively. 

Federal Reserve Chairman Powell once again downplayed the possibility of an interest rate cut in March, and the U.S. 2-year bond interest rate plummeted to 4.5%. U.S. stocks came under pressure on Monday. The Dow opened 107 points lower and then continued downward, once falling 434 points to 38,220 points; The index once fell 0.82%; the Nasdaq, which is dominated by technology stocks, retreated at most 1.01%. 

At the close of the U.S. market, the Dow Jones Industrial Average still fell 274 points, or 0.71%, to 38,380 points; the S&P Index fell 15 points, or 0.32%, to 4,942 points; the Nasdaq Composite's decline shrank to 31 points, or 0.2%, to 15,597 points. 

The U.S. dollar index rose as much as 0.66% to 104.604; the yen once fell 0.34%, hitting a low of 148.89 per dollar; the euro fell 0.6% to $1.0723. The Reserve Bank of Australia is expected to keep interest rates unchanged on Tuesday, and the Australian dollar fell 0.66% to 64.69 US cents.